What Are FHA Loan Limits In Chicago In 2017?

This BLOG On What Are FHA Loan Limits In Chicago In 2017 Was Written By Gustan Cho

Many home buyers, especially home buyers in Chicago and the suburbs of Illinois ask What Are FHA Loan Limits In Chicago In 2017. The Chicagoland Area consists of Chicago and its surrounding suburbs which are in six Counties of Northeastern, Illinois. The answer to What Are FHA Loan Limits In Chicago In 2017 has been often asked since the rumors that FHA was increasing the FHA Loan Limits nationwide went viral. We will answer the question of What Are FHA Loan Limits In Chicago In 2017 later on this article. Here are the six Counties of the Chicagoland Area and its suburbs in Northeast Illinois:

  • Cook County: Cook County, Illinois is where the city of Chicago, Illinois is in
  • Lake County: Lake County, Illinois borders the state of Wisconsin and large cities such as Gurnee, Illinois, Fox Lake, Illinois, Waukegan, Illinois are located
  • Will County: Will County, Illinois is where large cities like Joliet, Illinois, Lockport, Illinois, New Lenox, Illinois, Romeoville, Illinois is located
  • DuPage: DuPage County, Illinois
  • McHenry: McHenry County, Illinois
  • Kane: Kane, County Illinois

The FHA have higher limits in Chicago and the six suburbs of Chicago, Illinois than other counties of Illinois. The current FHA Loan Limits For Chicago as well as the surrounding Chicagoland and its six counties was $365.700 for a single family home. Here were the FHA Loan Limits For Chicago and surrounding suburbs where the Cook, Lake, Will, DuPage, McHenry, and Kane Counties are:

  • Single Family Home FHA Loan Limits In Chicago And Surrounding Suburbs of Illinois $365,700
  • Two Unit Properties FHA Loan Limits In Chicago And Surrounding Counties $468,150
  • Three Unit Properties FHA Loan Limits In Chicago And Surrounding Counties of Chicago $565,900
  • Four Unit Residential Properties FHA Loan Limits In Chicago And Surrounding Counties of Chicago $703,250

You can qualify and purchase for a one to four unit property for a FHA Loan in Chicago and the Chicagoland Area with a 3.5% down payment and a 580 FICO Credit Score.

About FHA Loans And Qualifying For A FHA Loan In Chicago And The Suburbs Of Chicagoland Area

What is a FHA Loan? Many first time home buyers often are not familiar with the mortgage loan process and rely on getting a home loan from the first mortgage lender they contact. The mortgage loan officer will often times offer different mortgage loan programs that they may qualify for or may just tell them that they qualify for only a particular mortgage loan program.

Two of the most popular mortgage loan programs in the United States are the following mortgage loans:

We will cover What Are FHA Loans on this mortgage BLOG. Here are the basics on FHA Loans:

  • FHA Loans is by far the most popular mortgage loan program out today
  • FHA Loans are mortgage loans that are originated, processed, underwritten, and funded by private banks and mortgage bankers who are FHA approved
  • FHA, the Federal Housing Administration, is a subsidiary of the United States Department of Housing and Urban Development, is not a mortgage lender
  • FHA is a governmental agency that insures mortgage loans to banks and mortgage companies who have originated FHA Loans that meet FHA lending guidelines
  • FHA insures mortgage lenders in the event of borrower default on their FHA Loan and the home goes into foreclosure
  • In order for a FHA to insure the FHA Loan of a FHA Lender who has a FHA Loan borrower that defaults on his or her loan, the mortgage lender that originates and funds the FHA Loans tneeds to make sure that the FHA mortgage loan borrowers has met all FHA Guidelines with respect to minimum credit scores, debt to income ratios, and other credit and income FHA mortgage guidelines.

Minimum FHA Lending Guidelines

FHA sets their own rules and regulations which are called FHA mortgage lending guidelines.  Minimum FHA Lending Guidelines are as follows:

  • Minimum credit score of 580 FICO credit scores to qualify for a 3.5% down payment home purchase
  • Homes that are eligible are only owner occupied homes that are one to four units
  • Condominiums needs the condominium complex to be FHA Approved
  • Manufactured homes needs to be on fixed concrete foundations. Mobile homes do not qualify.
  • Debt to income ratios are as follows: If your credit scores are 620 FICO or higher, the maximum back end debt to income ratios allowed is capped at 56.9%.  The maximum front end debt to income ratios are capped at 46.9%. If your credit scores are under 620 FICO, then your debt to income ratios gets reduced to 43% DTI

Qualifying For FHA Loans After Bankruptcy

Borrowers of FHA Loans can qualify for a FHA Loan after the following:

  • Chapter 7 Bankruptcy
  • Chapter 13 Bankruptcy
  • Foreclosure
  • Deed In Lieu Of Foreclosure
  • Short Sale

However, there are mandatory waiting period to qualify for a FHA Loan after the above. Here are the waiting periods to qualify for a FHA Loan after bankruptcy and foreclosure:

  • There is a two year mandatory waiting period after a Chapter 7 bankruptcy discharge to qualify for a FHA Loan with re-established credit and no late payments after bankruptcy
  • You can qualify for a FHA Loan one year into a Chapter 13 Bankruptcy Repayment Period with the approval of your Chapter 13 Bankruptcy Trustee.
  • There is no waiting period to qualify for a FHA Loan after a Chapter 13 Bankruptcy discharged date
  • There is a three year waiting period after a foreclosure, deed in lieu of foreclosure, and short sale to qualify for a FHA Loan
  • The start date of the waiting period after foreclosure and deed in lieu of foreclosure is from the recorded date or the date of the sheriff’s sale and not the date the keys were surrendered to the mortgage lender
  • The waiting period after short sale starts from the date that is reflected of the short sale on the HUD Settlement Statement.
  • Non-Occupant Co-Borrowers are allowed. More than one non-occupant co-borrowers are allowed by FHA to qualify for FHA Loans
  • 100% of the down payment can be gifted by a family member or relative.

What Are FHA Loan Limits In Chicago In 2017 Versus Other Cities?

The FHA Loan Limits In Chicago In 2017 Versus Other Cities remain the same because Chicago and its six counties of Cook County, Lake County, DuPage County, Will County, McHenry County, and Kane County have higher FHA Loan Limits than the rest of the counties in the state of Illinois. FHA Loan Limits In Chicago Versus Other Counties in Illinois are the following:

  • Single Family Home $365,700
  • Two Units $468,150
  • Three Units $565,900
  • Four Units $703,250

What Are FHA Loan Limits In Other Counties Of Chicagoland Area

Here are the FHA Loan Limits In Other Counties Of Illinois:

  • Single Family Home $275,665
  • Two Units $352,950
  • Three Units $426,625
  • Four Units $530,150

FHA Lender With No Lender Overlays In Chicago And Its Suburbs

If you are a first time home buyer or home buyer and have more questions on What Are FHA Loan Limits In Chicago In 2017 and are looking for a FHA mortgage lender with no lender overlays, contact me at 262-716-8151 or email me at GCho@gustancho.com. My staff of loan originators and I are available 7 days a week, including evenings, weekends, and holidays.There are two sets of FHA Lending Guidelines.  The main FHA Guidelines are the FHA Mortgage Lending Guidelines set by FHA.  The second set of FHA Guidelines are mortgage lender overlays that each individual FHA mortgage lender sets that can far exceed the minimum FHA lending guidelines. The answer to the question if all FHA Lenders have the same lending guidelines, the answer to that is no. Just because you meet the minimum FHA Lending Guidelines set by FHA does not guarantee you a FHA insured mortgage loan by a lender. On the flip side, just because you are told you do not qualify for a FHA Loan by a particular FHA mortgage lender does not mean that you do not qualify for a FHA Loan. For example, all you need to qualify for a 3.5% down payment FHA Loan is a 580 FICO credit score. However, most mortgage companies and banks will not qualify you for a FHA Loan with a 580 FICO credit score. Many will require you to have a 640 FICO credit score or higher. This is called a FHA mortgage lender overlay on credit score. If you are told you do not qualify for a FHA Loan because you do not have 640 FICO credit scores or higher, no worries. You may not qualify for a FHA Loan with that particular lender but that does not mean you do not qualify for a FHA Loan.

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.

2 Comments

  1. Bennie Chukwurah says:

    Nice post. How many fha loans can a borrower have?

    • Gustan Cho says:

      You can normally have one FHA at one time, however, if you have currently a FHA Loan and have lived on the home with the FHA Loan and want to keep that home as a rental property, you can purchase another home with a FHA Loan. There are restrictions and rules. The second home purchase needs to be your primary residence and needs to be at least 60 miles away from the home you are exiting. The deal needs to make sense like you are being forced to move because of a job transfer. Remember, that FHA Loans are for owner occupant properties only.