FHA vs Conventional Loan Limits for 2023
Loan limits refer to the maximum loan available for a specific program. Here are FHA vs conventional loan limits for 1-unit homes in 2023.
- FHA: $472,030
- Conventional: $726,200
Keep in mind that these are the “base” limits, and maximum loans are higher for high-cost areas and multifamily properties.
Most lenders impose a minimum loan amount that they will accept. There is no minimum loan set by FHA or conventional loan agencies themselves.
FHA vs Conventional Loan Limits - Standard Areas
FHA vs Conventional Loan Limits - High-Cost Areas
FHA vs Conventional Loan Limits - AK, HI, Guam, Virgin Islands
Both loan types issue loan limits that are somewhere between the standard and highest limits for many areas of the country.
For instance, the FHA loan limit for a 1-unit home in San Antonio, Texas is $524,400. This is above the base FHA limit of $472,030 but below the highest limit found in the U.S. which is $1,089,300.
The best place to find your local FHA limit is HUD’s FHA loan limit tool. Choose your state and county, and make sure the tool is set to “FHA Forward” and the current year.
Image: HUD. Callout boxes added.
Conventional loan limits are also in between in many areas. For instance, the 1-unit conventional limit in Steamboat Springs, Colorado is $845,250.
Check your conventional loan limit by entering an address at Fannie Mae’s lookup tool and seeing “Conforming Loan Limits.”
Image: Fannie Mae. Callout box added.
Your Loan Limit Based On Income And Down Payment
Keep in mind that you need to qualify for the loan amount for which you apply. Your personal limit may be lower than the county limit.
For instance, if your local conventional loan limit is $726,200, but you only qualify for $500,000, your personal loan limit will be $500,000.
Additionally, maximum loan amounts are also subject to a minimum down payment.
If you are buying a home for $400,000 using FHA, your maximum loan on that home is $386,000 even if the local loan limit is higher.
Minimum Down Payment (3.5%)
Loan Limits Apply To The Loan, Not The Home Price
One common misconception about loan limits is that they apply to the home price. That’s not the case.
For example, you could buy a $5 million home with an FHA loan by putting $4.6 million down. Neither FHA nor conventional loan agencies impose a maximum home price.
What Is A Fannie Mae High-Balance / Freddie Mac Super Conforming Loan?
Fannie Mae and Freddie Mac are the two major agencies that create rules for most conventional mortgages.
These agencies have a name for loans in high-cost areas that are over the standard limit ($726,200 for a 1-unit home in 2023) but still within the highest limit available ($1,089,300).
For example, if you received a loan for $900,000 in Seattle, Washington, you could use a Fannie Mae or Freddie Mac loan, since the local limit is $977,500 for 2023. However, this loan would be called a “High-Balance” loan if you received a Fannie Mae financing from the lender, and Super Conforming if Freddie Mac was the mortgage backer.
High Balance and Super Conforming loans come with restrictions compared to loans within standard limits. For example,
Higher down payments
Fewer loan features available
FHA does not have extra limitations on its loans that are over the standard limit.
Use Higher Loan Limits To Avoid Jumbo Loans
Jumbo loans are quite useful for high-net-worth individuals buying an expensive home. However, they are much harder to qualify for than an FHA or standard conventional loan.
For example, you may need 20% down for a jumbo loan. A few lenders offer jumbo loans at 5-10% down, but not many.
Plus, you’ll need near-perfect credit for most of these products.
However, if you’re buying a home in a high-cost area like Seattle, Los Angeles, Denver, or Boston., you may qualify for a large FHA or conventional loan, bypassing the extra requirements for jumbo loans.
FHA Loan Limit
Conventional Loan Limit
Check your local limits if you’re considering a jumbo loan. You may more easily qualify for low-down-payment FHA or conventional financing.
Generous Loan Limits Help You Buy More Home
If you’re considering an expensive home, an FHA or conventional loan might be the right tool to finance it, thanks to generous loan limits.
Speak to a lender and see how much you qualify for.
Tim Lucas spent 11 years in the mortgage industry and now leverages that real-world knowledge to give consumers reliable, actionable advice. Tim has been featured in national publications such as Time, U.S. News, MSN, The Mortgage Reports, My Mortgage Insider, and more.