Conventional High Cost Area Financing.
Here is a link with a list of the conforming loan limits for 2017
PDF List of Counties With Conforming Limits For 2017
Here is the site to look up FHA and Fannie Mae/Freddie Mac Loan Limits.
Look Up For Fannie Mae/Freddie Mac Limits For 2017
You can borrow for up to 10 conventional mortgages, down to a price of 10k, and up to confirming limits in your county. You have the option of a 15, 20 or 30 year term.
You can have an unlimited amount of mortgages and still obtain Primary Residence Financing. You are limited to 6 financed properties for investment properties with high balance financing ( the point between the standard ceiling limit and your area's ceiling limit - if above the standard )
Standard Conforming limits are below;
1 unit - $424,100
2 unit- $543,000
3 unit - $656,350
4 unit - $815,650
Maximum Conforming limits are below (If Your Area Qualifies, Please Use the Look Up Link Above to see where your location falls);
1 unit - $636,150
2 unit - $814,500
3 unit - $984,525
4 unit - $1,223,475
Maximum Conforming limits are below (If Your Area Qualifies, For Specialty Financing);
Honolulu; Kalawao, Maui; Kauai;
1 unit - $721,150 1 unit - $657,800 1 unit - $713,000
2 unit - $723,050 2 unit - $842,100 2 unit - $912,750
3 unit - $1,115,800 3 unit - $1,017,900 3 unit - $1,103,350
4 unit - $1,386,650 4 unit - $1,265,000 4 unit - $1,371,150
Anything above this limit, but below your specific counties conforming limit is considered high balance financing. There are different guidelines for both standard conforming limits and for high balance financing. Jumbo loans are for primary residence only and above conforming limits.
Standard Conforming Limit Financing
For A Fixed Rate Purchase, Primary properties, Mortgages 1-6;
- A SFR requires a LTV of 97% (first time buyer only, 95% if not your first purchase)
- A Duplex requires a LTV of 85%
- A Triplex & Fourplex requires a LTV of 75% (possibly 80% with Freddie Mac)
- A minimum credit score of 620
For A Fixed Rate Purchase, Investment properties, Mortgages 1-6;
- A SFR requires a LTV of 85%
- A MFR requires a LTV of 75%
- A minimum credit score of 620
For A Fixed Rate Purchase, Investment properties, Mortgages 7-10;
- A SFR requires a LTV of 85%
- A MFR requires a LTV of 75%
- A minimum credit score of 720
High Balance Limit Financing (Within Conforming limit for individual county specific, & above standard conforming limit)
For A Fixed Rate Purchase, Primary properties, Mortgages 1-6;
- A SFR requires a LTV of 95%
- A Duplex requires a LTV of 85%
- A Triplex & Fourplex requires a LTV of 75%
- A minimum credit score of 620
For A Fixed Rate Purchase, Investment Properties, a maximum of 6 financed properties ONLY ALLOWED. You can not do a high balance loan on an investment property if you have greater than 6 mortgaged properties, including subject property!
- A SFR requires a LTV of 85%
- A MFR requires a LTV of 75%
- A minimum credit score of 620
Here are some answers to FAQ as well;
1. For all 1- to 4-unit investment property transactions.
Cash Reserves Required For Other Properties Owned by Investor;
Cash Reserve Requirements;
6 months PITI is required on subject property.
If you have 1-4 financed properties than it is now 2% of all unpaid principle balances.
If you have 5-6 financed properties than it is now 4% of all unpaid principle balances.
If you have 7-10 financed properties than it is now 6% of all unpaid principle balances.
Money must be in account for 60 days or sourced. A HELOC can be used as down payment, but not as cash reserves.
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2. Gift funds are not allowed on Investment property transactions.
3. Escrows for taxes and insurance are required unless otherwise approved by the underwriter.
4. Loans for investment properties are not eligible if the transaction includes non-arm’s length and/or at-interest characteristics
5. Investment property transactions cannot close in trust.
6. Maximum 2% sellers concessions is allowed for investment purchases!!
Fannie Mae's Requirement for 1-4 Mortgaged Properties.
Fannie Mae's Requirements for 5-10 Mortgaged Investment Properties
Freddie Mac Requirements for 1-6 Mortgaged Properties.
These California cities are in the High Cost areas for 2015;
Los Angeles, Anaheim, Long Beach, San Jose, Sunnyvale, Santa Clara, San Francisco, Oakland, Hayward, Santa Barbara, Santa Maria, Santa Cruz, Watsonville
The CA counties are included in the high cost areas;
Alameda, Contra Costa, Los Angeles, Marin, Orange, San Benito, San Francisco, San Mateo, Santa Barbara, Santa Clara, Santa Cruz
These Colorado cities are in the High Cost areas for 2015;
Edwards, Glenwood Springs, Steamboat Springs, Breckinridge
The CO counties are included in the high cost areas;
Eagle, Garfield, Pitkin, Routt, San Miguel
Washington and Arlington - District of Columbia
These Hawaii cities are in the High Cost areas for 2015;
Kahului, Wailuku, Lahaina
The HI counties are included in the high cost areas;
Honolulu, Maui, Kalawao, Kauai
These Idaho cities are in the High Cost areas for 2015; Bailey, Hailey
The ID counties are included in the high cost areas; Blaine, Camas, Lincoln, Teton
The NY NJ PA counties are included in the high cost areas;
Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset, Sussex, Union, Bronx, Dutchess, Kings, Nassau, New York, Orange, Putnam, Queens, Richmond, Rockland, Suffolk, Westchester
These New York, New Jersey, Pennsylvania cities are in the High Cost areas for 2015;
Jersey City, Newark, New York
Elizabeth City in NC with counties of Camden, Pasquotank, Perquimans
In DC, VA, MD, WV - Washington, Arlington, and Alexandria
In MA - Vineyard Haven - Dukes and Nantucket
Fannie Mae/Freddie Mac High Cost are limits are the same as FHA for 2017. VA is the same as FHA for 2017
FHA and VA are owner occupied and have to be mortgage 1-4. Conventional can be both owner occupied or investment with up to 10 mortgages.
For more information on high cost area, VA Financing - please see one of my other blogs;
For more information on high cost area, FHA Financing - please see one of my other blogs;
This information is accurate as of the time of posting. Please also verify the accuracy of this information at the time you are considering these options as guidelines change.
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