| HUD No. 06-OR-01
January 6, 2006
HUD RAISES FHA MORTGAGE INSURANCE LIMITS
Comprehensive Update Boosts FHA Limits in 28 Oregon Counties
PORTLAND - More homebuyers in Oregon may be eligible for FHA insurance on their mortgages and home
improvement loans under new mortgage limits effective January 1 announced by the U.S. Department of Housing
and Urban Development. The new FHA mortgage limit for a single-family unit in 25 of Oregon's 36 counties is $200,160, which allows for purchase of a home costing $206,351 with the required 3 percent downpayment.
This increase follows the October jump for the Portland region and for Clatsop, Deschutes, Jackson, Josephine, and Lane counties. Deschutes, Benton and Lane counties increased again January 1. Higher loan limits also apply for two to four-unit dwellings.
In 25 Oregon counties, the increase is 15.9 percent above the previous limit of $172,632. Benton county increased 5.2 percent to $233,700; Deschutes 7 percent to $254,125; and Lane 2.9 percent to $205,200. Loan limits are unchanged for Clackamas, Clatsop, Columbia, Jackson, Josephine, Multnomah, Washington, and Yamhill counties.
For a complete list by county, go to FHA Mortgage Limits page.
These increases may allow more prospective homebuyers to qualify for FHA insured mortgages and home
improvement loans to purchase or refinance one to four-unit residences including condos and manufactured homes. The higher limits will help seniors, age 62 or older, seeking FHA insured reverse mortgages (Home Equity Conversion Mortgages) to potentially access more equity from their homes.
"This significant increase in FHA loan limits is in response to last year's rapid increases in the average price of
housing in Oregon and will help more people purchase or refinance homes using FHA mortgage insurance," said HUD Portland Field Office Director Tom Cusack.
Many homebuyers are attracted to FHA insured loans because of the program's benefits: a 3 percent down payment, which can be 100 percent gifted from an acceptable source, liberal underwriting criteria, market rate interest, and consumer protections. FHA loans are not restricted to first-time homebuyers.
Unlike some other loan products that advertise low down payment loans, the 3 percent down payment provisions of FHA financing are available to ALL homebuyers who use FHA financing, NOT just those homebuyers with the very highest credit scores. That means when an FHA lender approves a family for an FHA owner-occupant home loan, the family also is qualified for 3 percent down payment financing, if the home price is within the FHA mortgage limits.
The increases will also benefit senior citizens who qualify for FHA-insured reverse mortgages. Reverse mortgages
allow homeowners age 62 and older to borrow against the value of their homes without selling them. Homeowners
can select a lump-sum payment, monthly payments or tap into a line of credit. No repayment is required as long as
a homeowner lives in a home with a reverse mortgage. The reverse mortgage is repaid, with interest, when a homeowner sells the home or dies.
The new loan limits are part of a regular adjustment HUD makes to account for rising home prices. The higher FHA
loan limits will not cost the government because the FHA Insurance Fund is fully supported by premiums paid by borrowers who receive FHA insurance.
HUD is the nation's housing agency committed to increasing homeownership, particularly among minorities, creating affordable housing opportunities for low-income Americans, supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development as well as
enforces the nation's fair housing laws. More information about HUD and its programs is available on the Internet and espanol.hud.gov.