The Federal Housing Administration (“FHA”) recently announced 2023 loan limits applicable to FHA-insured Single Family Title II Forward Mortgages in Mortgagee Letter 2022-20.The FHA raised the maximum loan limits across all counties based on the median home price in each area.
The FHA maximum loan limits are calculated as a percentage of the national conforming loan limits, which were recently increased for 2023 to reflect the continuing rise in housing prices across the country.
The FHA will increase the low-cost area “floor” from $420,680 to $472,030 for one-unit properties. This figure is equal to 65% of the national conforming loan limit of $726,200 recently announced by the Federal Housing Finance Agency. The loan limit “ceiling” will also increase in high-cost areas from $970,800 to $1,089,300, matching conventional conforming loan limits in high-cost areas. This “ceiling” amount is equal to 150% of the national conforming limit for one-unit properties.
Alaska, Hawaii, Guam, and the Virgin Islands are special exception areas, with mortgage limits adjusted by FHA to cover higher costs of construction. These four special areas have a higher ceiling limit of $1,633,950 for a one-unit.
The new loan limits are effective for case numbers assigned on or after January 1, 2023 through December 31, 2023. The 2023 calendar year loan limits will be included in a future Single Family Housing Policy Handbook 4000.1 update, including section II.A.2.a.ii(B) – Low-cost Area; section II.A.2.a.ii(C) – High-cost Area; and section II.A.2.a.II(D) – Special Exceptions for Alaska, Hawaii, Guam and the Virgin Islands.
For a complete list of FHA loan limits, please visit FHA’s Loan Limit page.
