FHA loan limits for multifamily housing in 2022 have increased. The Federal Housing Administration announced that the2022 multifamily loan purchase caps for Fannie Mae and Freddie Mac (the Enterprises) will be $78 billion for each — a combined total of $156 billion to support the multifamily market.
The 2022 caps, which increased from $70 billion for each Enterprise in 2021, are based on FHFA’s projections of the overall growth of the multifamily originations market.
At least 50% of the Enterprises’ multifamily loans are required to be used for affordable housing. FHFA also requires at least 25% of the Enterprises’ multifamily business to be affordable to residents at or below 60% of area median income (AMI), up from 20% in 2021.
In addition, FHFA has changed certain definitions of multifamily mission-driven affordable housing in Appendix A of the Conservatorship Scorecard. In 2022, FHFA will allow loans on affordable units in cost-burdened renter markets and loans to finance energy or water efficiency improvements with units affordable at or below 60% of AMI to be classified as mission-driven.
FHFA will continue to monitor the impacts of COVID-19 on the multifamily mortgage market and will update the multifamily caps and mission-driven requirements if adjustments are warranted. However, to prevent market disruption, if FHFA determines that the actual size of the 2022 market is smaller than was initially projected, FHFA will not reduce the caps.
Single Family Home Loans
In 2021 the FHA raised the mortgage limit single-family homes in metro-Atlanta counties. Homebuyers seeking to purchase a house in Cherokee, Cobb, Forsyth, Fulton, Gwinnett, Paulding, or Henry Counties can be approved on an FHA loan for up to $412,850. This added flexibility has certainly supported the strong market and activity that we’ve seen in the Atlanta real estate market. For those that don’t know, the FHA provides mortgage insurance on loans made by FHA-approved lenders throughout the United States. We are waiting to see if the FHA loan limits will be increased for single-family in 2022.
FHA-insured loans are extremely popular, especially for first-time homebuyers, because they require a minimal down payment in order to close the loan. There is also more flexibility in calculating household income and payment ratios. The FHA was the government’s solution to a nation comprised primarily of renters, only 4 in 10 households owned homes. Of course, this was back in the 1930s, as the FHA was created in 1934. However, this government agency successfully turned America into a nation of homeowners, with a 68.1 % homeownership in 2001. Enough with the history lesson, get on the phone, get online or get out the door and find yourself a spectacular home in the metro Atlanta area because getting approved for a $340,000 loan has now been made much easier.