The United States Department of Housing and Urban Development (HUD) increased FHA loan limits for almost every county this year. Thus, FHA borrowers have a bigger budget when it comes to buying homes in 2021.

So if you’re looking into getting a mortgage with a lower down payment, here are vital pieces of information regarding FHA loan limits this year.

What FHA Loan Limits Are All About

In general, FHA loan limits refer to the maximum amount allotted by the Federal Housing Administration (FHA) to insure different categories of home mortgages in various counties in each state.

Loan limits vary depending on the local housing value and property type. These are updated and calculated annually. However, they are influenced mainly by the conventional loan limits that Fannie Mae and Freddie Mac set.

Currently, FHA loan limits for single homes begin at $356,362 in lower-cost markets. But in more expensive areas, limits peak up to $822,375. For duplexes, the limit is $456,275 in most areas and $1,053,000 in high-cost places.

Of course, there are also loan limits for triplexes and quadruplexes, starting at $551,500 and $685,400 for low-cost vicinities but peaking at $1,272,750 and $1,581,750 for more expensive metro areas.

Compared to last year, it’s pretty noticeable that there’s a reasonable increase in the FHA loan limits set this year. However, do note that these amounts aren’t applicable in all counties. Thus, it’s essential to check the FHA loan limits for your local area to be sure.

How to Find FHA Loan Limit for Your Area

It’s not that difficult to find details about FHA loan limits, as some numerous digital tools and platforms provide these kinds of information. In addition, you can also check with the United States Department of Housing and Urban Development (HUD), which offers online search tools where you can find more information about FHA loan limits in any county or state.

Why the FHA Loan Limit Rose This Year

This year, the increase in FHA loan limits is due to the swelling prices of homes in the real estate market, as single-family home prices rose 12 percent in the third quarter of the previous year, according to the National Association of Realtors (NAR).

Correspondingly, the National Housing Act, as amended by the Housing and Economic Recovery Act of 2008 (HERA), mandated that the FHA set single-family forward loan limits at 115 percent of median home prices without exceeding more than 150 percent of the standard limit. Additionally, HERA rules also state that the FHA must base loan limits on those set by Fannie Mae and Freddie Mac—resulting in the hike in the FHA loan limits in 2021.


Most of the time, people tend to overlook details such as loan limits when applying for a mortgage. However, staying updated on these kinds of information can actually play to your advantage, as you’d have access to better deals that can be pretty beneficial in buying a new home.

Looking for a reliable loan agency near you? Pennix Mortgage is committed to matching clients with the perfect loan option that meets their financing needs. So whether you are refinancing or purchasing a home, we guarantee to offer you the lowest mortgage rates. Give us a call today!