California FHA Loan Limits Rise in 2018

The Federal Housing Administration and Congress agreed to keep California loan limits at the previous year's level for 2018. This is great news for prospects looking to buy a house and homeowners seeking the opportunity to refinance their mortgage into a loan at a reduced interest rate.

Ever since the decline of the housing market in the early 2000s, the use of FHA home loans has increased and today these loans remain among the most popular in the nation. There are plenty of reasons for that, but it really comes down to the fact that for first time home buyers and for those with low credit scores, FHA financing is one the easiest to qualify for and offer some of the best terms available.

However, there has been some concern in recent years as to the loan limits associated with them. For the 2018 year, experts agree that the fact that California FHA loan limits aren't going to change isn't a bad thing. And since only one other thing is changing regarding FHA loans, they'll still be easier to qualify for and will be an excellent choice for anyone who is struggling to secure a more traditional loan, either because of a lack of a large down payment or because of a less than perfect FICO score.

California FHA Limits

California loan limits vary depending on exactly where you live. In densely populated metro areas where costs are very high, loan limits will finally get a boost. For those looking for a home in rural areas or those where housing costs are lower, the loan limit will also remain the same for 2018, at $271,050.

As mentioned above, there is one thing that will be changing regarding all FHA insured loans. Specifically, for 2015 the annual insurance premiums associated with FHA loans is going to drop from 1.35 down to .85. When this is combined with today's much lower interest rates of less than 4 percent in most cases, it means that new FHA loans will offer some very substantial cost savings. And those who are looking to refinance through FHA programs will also be able to find reduced prices thanks to these new changes.

Luckily, the homes on the market today are still hovering at right around the same prices they were in most of 2017 as well. This means that those who are shopping for a home will still have little trouble finding one that falls within the limits of an FHA loan, making it easier to secure the loan that you need to get into the home of your dreams.

So, all in all, while the FHA loan limits aren't changing for 2018, it's likely that this won't really have an impact on those seeking out loans. If anything, the lowered premiums will only help those seeking a loan since it will make it more affordable to get and maintain a loan throughout time.

You'll still need to meet the qualification requirements of an FHA loan. This usually means having a credit score of at least 600 and a down payment of around 3.5%, though credit scores could actually be slightly lower with the right down payment. These loans are still among the best choices for anyone looking to secure a loan and move into their dream home.

Interest rates and lending standards for first time house buyers are subject to change without notice. Discuss your credit and eligibility with a licensed mortgage lender today.


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Copyright ©2001-2018 and Beyond. BDnationwidemortgage.com is a website and cannot make loans. BDNationwideMortgage.com does not have any affiliation with the FHA or any other government entity. All rights reserved. FHA does have a minimum equity requirement of 85% LTV for refinancing with cash out loans.