Conventional Loan And FHA Loan Limits For 2014 With New Mortgage Regulations

Due to new mortgage regulations by the Federal Housing Finance Agency, also known as FHFA and the United States Housing and Urban Development, known as HUD, most wholesale mortgage lenders will be releasing Conventional loan and FHA loan limits for 2014 effective January 10, 2014.

Conventional Mortgage Loans

For all conventional mortgage loans  dated after January 1, 2014, the maximum conventional mortgage loan limits will stay at the existing limit levels with the exception in 18 counties where the loan limits will increase in high cost areas.  Conventional mortgage loans in high cost areas will qualify for the higher new conventional mortgage loan limits starting January 1, 2014.

Underwriting

Regardless of lock status, if a loan is currently approved by the underwriting department and the borrower requests to take advantage of the increased loan amount parameters, the loan must be resubmitted to Underwriting/Automated Underwriting Systems (AUS) for consideration. All revised loan amounts are subject to the most recent guideline changes and eligibility criteria.

Conventional conforming loan limits are published by FHFA at http://www.fhfa.gov/Default.aspx?Page=185.

FHA Insured Mortgage Loans

Due to the expiration of the authority granted in the Consolidated and Further Continuing Appropriations Act of 2012, and as announced in Mortgagee Letter 201343, the calculation of FHA’s single family loan limits (forward mortgages) is altered. This has resulted in a decrease in the calculation of highcost area limits and the loan limit “ceiling” for case numbers assigned on or after January 1, 2014. The new loan limits apply to all loan transaction types except Streamline.

Refinance mortgage loans without an appraisal, which are not subject to the same section of the National Housing Act.

Maximum Loan Limits

Any area where the loan limits exceed the “floor” is a highcost area. FHA minimum (floor) loan limits are set at 65% of the national conforming loan limit and will remain at $271,050 for 1unit properties. The maximum (ceiling) loan limits for highcost areas are set at 150% of the national conforming loan limit and will decrease from $729,750 back to $625,500 effective with case numbers assigned on or after January 1, 2014.

Due to the fluctuation in area median home prices, county loan limits increased in 89 counties and decreased in 652 counties.

In an effort to provide advance notice in the Lock Engine, a message will be provided on all FHA loans. An eligibility rule will display on all FHA loans at the time of lock/registration.

Pricing For Conventional Loan And FHA Loan Limits For 2014

If a loan is locked but not submitted and a revised loan amount is requested, the request must be submitted and locked to the mortgage lender lock desk.

Standard pricing policy applies which may result in a price change.

Additionally, if a lock has expired, worstcase pricing policy applies.

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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