In the Market for a Home Loan? ACT FAST before Mortgage Loan Limits Change in 2014.
Important news if you are in the market for a home loan: Effective January 1, 2014, the loan limit for FHA for Sarasota and Manatee Counties has been REDUCED to $285,200. This means that if you have been sitting on the fence about obtaining a mortgage, NOW is the time to apply for a mortgage before the change takes effect.
Background information: What Is a Loan Limit?
Federal Housing Administration lending limits inform homebuyers how much FHA borrowing power they have in their area of the country. FHA loan limits vary based partly on the state and county in which the property is located.
Loan limits are appropriately named. They are the maximum allowable loan size for a government backed mortgage. Loan limits vary by product and region, and are included in a program's specific mortgage guidelines.
For example, the Federal Housing Administration enforces specific loan limits for FHA loans; and the Department of Veterans Affairs maintains specific loan limits for VA loans. Loans which exceed an FHA loan's local loan limit cannot be insured and loans exceeding a VA loans local limit cannot be guaranteed.
For conforming loans -- loans backed by Fannie Mae or Freddie Mac -- loan limits have been unchanged since 2006 when the government moved to raise the national limit to $417,000.
Conforming loans which exceed a local loan limit are commonly known as "jumbo loans". Jumbo loans are typically not backed by Fannie Mae or Freddie Mac and are offered by local and national banks.
