FHA Loan Limits in Maine
Loans backed by the Federal Housing Administration (FHA) are often a good match for homebuyers with low credit scores and very little money saved for a down payment. The FHA loan limit for a single-family home in most Maine counties is $472,030. However, some parts of Maine qualify for FHA loan amounts as high as $506,000.
Maine FHA loan limits by county
| County name | One unit | Two unit | Three unit | Four unit | Median sale price |
|---|---|---|---|---|---|
| ANDROSCOGGIN | $472,030 | $604,400 | $730,525 | $907,900 | $266,000 |
| AROOSTOOK | $472,030 | $604,400 | $730,525 | $907,900 | $142,000 |
| CUMBERLAND | $506,000 | $647,750 | $783,000 | $973,100 | $440,000 |
| FRANKLIN | $472,030 | $604,400 | $730,525 | $907,900 | $196,000 |
| HANCOCK | $472,030 | $604,400 | $730,525 | $907,900 | $288,000 |
| KENNEBEC | $472,030 | $604,400 | $730,525 | $907,900 | $253,000 |
| KNOX | $472,030 | $604,400 | $730,525 | $907,900 | $313,000 |
| LINCOLN | $472,030 | $604,400 | $730,525 | $907,900 | $297,000 |
| OXFORD | $472,030 | $604,400 | $730,525 | $907,900 | $270,000 |
| PENOBSCOT | $472,030 | $604,400 | $730,525 | $907,900 | $229,000 |
| PISCATAQUIS | $472,030 | $604,400 | $730,525 | $907,900 | $166,000 |
| SAGADAHOC | $506,000 | $647,750 | $783,000 | $973,100 | $440,000 |
| SOMERSET | $472,030 | $604,400 | $730,525 | $907,900 | $189,000 |
| WALDO | $472,030 | $604,400 | $730,525 | $907,900 | $263,000 |
| WASHINGTON | $472,030 | $604,400 | $730,525 | $907,900 | $165,000 |
| YORK | $506,000 | $647,750 | $783,000 | $973,100 | $440,000 |
How are FHA loan limits determined?
FHA loan limits are reviewed yearly based on a percentage of the conforming loan limit – which is $726,200 – set by the Federal Housing Finance Agency for conventional loans. The U.S. Department of Housing and Urban Development (HUD) then sets a “floor” based on 65% of the conforming loan limit, which applies to most counties in the country. These counties are considered “low-cost” areas; the limit for a one-unit home in low-cost areas is $472,030.
The highest FHA loan limit is set at 150% of the conforming limits and is called the “ceiling.” It applies to higher-cost areas, which are usually near major cities, and is capped at $1,089,300 for a single-family home. The loan limits also vary depending on the number of living units — higher loan limits are available for each additional unit, up to a maximum of four.
How to qualify for an FHA loan in Maine
FHA loans can be a great option for a homebuyer in Maine who may not have a high credit score and who can’t afford a large down payment. You probably won’t exceed the FHA loan limits unless you buy a home well over the highest median home price of $440,000 for the most expensive counties in Maine.
Whether you’re a first-time or repeat buyer, however, you’ll still need to meet the FHA loan requirements, which include:
Down payment and credit scores. You may qualify for a down payment of 3.5% if your credit score is at least 580. FHA-approved lenders may approve you with a score as low as 500 if you can make a 10% down payment.
Debt-to-income (DTI) ratio. Your total debt divided by your income makes up your debt-to-income (DTI) ratio. FHA guidelines set the DTI maximum at 43%, but exceptions are possible with good credit and extra cash.
Mortgage insurance. You’re required to pay two kinds of FHA mortgage insurance to protect the lender in case you default. The first is an upfront mortgage insurance equal to 1.75% of the loan. The other is an annual mortgage insurance premium that ranges between 0.45% and 1.05% and becomes part of your monthly payment.
FHA home appraisal. An FHA appraisal is required to determine the condition and value of your home.
Primary residence. An FHA loan can only be used to buy a home you intend to live in for at least a year.
Buying a multifamily property with an FHA loan
You can purchase a multifamily home with as little as a 3.5% down payment, as long as you live in one of the units for at least a year. One extra perk: You may be able to use the rental income to qualify, and can take advantage of higher loan limits for each additional unit, up to four.
FHA lenders in Maine
| Lender name | LT rating | Minimum FHA credit score |
|---|---|---|
| Guild Mortgage | 3 stars | 540 |
| PennyMac Mortgage | 5 stars | 580 |
| Fairway Independent Mortgage | 3 stars | 580 |
| Truist Mortgage | 4 stars | 580 |
| Caliber Home Loans | 3 stars | 620 |