The ever changing real estate market is causing a lot of changes in the finance world, and one of the newest changes will be to the limit for FHA loan amounts in “high cost” areas. Currently a borrower can obtain an FHA insured loan for up to $729,750 and can go as low as 3.5% down. As of September 30 of this year, that amount will change to $625,500. For anyone who is in the market and planning to use FHA to purchase, this is pertinent news. If you do not have your loan approved prior to the end of September you will be required to put a minimum of 10% down (with excellent credit) and perhaps 20%.
Oakland, Berkeley, Alameda or any of the surrounding cities are considered “high cost” areas (which basically means that the median value is higher than the state average). If you are planning on buying real estate in any of those areas (or anywhere close to them) then you need to make sure you are aware of the coming change!
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