| FHA Loans can be used for a variety of | | | | interest rates as lower FHA mortgage amounts. FHA |
| circumstances in today's market. FHA loan limits in | | | | Jumbo Mortgages allow a home buyer to purchase a |
| certain, higher cost areas of the country are actually | | | | home and finance up to 96.5% of the purchase price. |
| higher than those for conventional loans (in some | | | | Other loan programs do not allow for such a high LTV |
| cases, much higher). They have become the most | | | | in today's lending climate. This is one of the reasons |
| popular loan type in America today and for good | | | | that FHA mortgage loans are so popular today. |
| reason. FHA Mortgage Loans allow for a much higher | | | | In addition to the FHA Maximum Loan Amount for a |
| Loan-to-Value (LTV) when compared to conventional | | | | give area, FHA home loans also carry certain |
| loans and FHA loans carry very low interest rates | | | | Debt-to-Income Ratios (DTI) that determine how much |
| over a broad range of credit profiles. | | | | of a loan amount a borrower can afford for their |
| FHA loan limits vary greatly over different areas of the | | | | particular circumstances. Current FHA maximum DTI |
| country. In most counties, the FHA maximum loan | | | | Ratios are 31% for the housing ratio (meaning the new |
| amount is $271,050. This limit is impacted by the | | | | house payment should not be more than 33% of the |
| average median income for that area. In other, higher | | | | total documented income) and 43% for the total |
| cost areas of the country, the loan limits can be higher | | | | expense ratio (meaning the new total monthly |
| and in some cases, substantially higher. The maximum | | | | expenses should not be more than 43% of the |
| FHA home loan amount in any area right now is | | | | borrowers documented income). These ratios can be |
| $729,750. | | | | exceeded with compensating factors, such as an |
| FHA that are over $417,000 are considered "FHA | | | | excellent credit score and payment history. |
| Jumbo Loans" and carry very similar terms and | | | | |