FHA Loan Requirements, Limits and Approval Tips
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2022 FHA Loan Limits in Massachusetts

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Loans backed by the Federal Housing Administration (FHA) offer lower down payments, lower closing costs and lower credit score requirements than a traditional mortgage loan.

In Massachusetts, the maximum loan limit for a single-family home depends on what county the home is located in. In 2022, the FHA loan limit is $420,680 for Berkshire, Franklin, Hampden, Hampshire and Worcester counties. The 2022 FHA loan limit increases to $770,500 for counties in the Boston metro area and in Dukes and Nantucket counties, the maximum 2022 FHA loan limit is $970,800.

Massachusetts FHA loan limits by county

County nameOne unitTwo unitsThree unitsFour unitsMedian sales price
BARNSTABLE$621,000$795,000$960,950$1,194,250$540,000
BERKSHIRE$420,680$538,650$651,050$809,150$270,000
BRISTOL$592,250$758,200$916,450$1,138,950$515,000
DUKES$970,800$1,243,050$1,502,475$1,867,275$1,050,000
ESSEX$770,500$986,400$1,192,300$1,481,750$670,000
FRANKLIN$420,680$538,650$651,050$809,150$335,000
HAMPDEN$420,680$538,650$651,050$809,150$335,000
HAMPSHIRE$420,680$538,650$651,050$809,150$335,000
MIDDLESEX$770,500$986,400$1,192,300$1,481,750$670,000
NANTUCKET$970,800$1,243,050$1,502,475$1,867,275$2,034,000
NORFOLK$770,500$986,400$1,192,300$1,481,750$670,000
PLYMOUTH$770,500$986,400$1,192,300$1,481,750$670,000
SUFFOLK$770,500$986,400$1,192,300$1,481,750$670,000
WORCESTER$420,680$538,650$651,050$809,150$365,000

How are FHA loan limits determined?

To determine loan limits for an FHA loan, the Federal Housing Finance Agency (FHFA) will review housing prices from each county from the previous year in order to find out what the average housing price was during the year. The FHFA uses this information to determine a conforming loan limit, which, in turn, the FHA uses to determine the current year’s loan limits. In 2022, the conforming loan limit is $647,200.

The FHA “floor” — or minimum loan limit — is 65% of the conforming loan limit, or $420,680 in 2022. The “floor” applies to counties where 115% of the median home prices are equal to or less than the “floor” amount. For counties where home prices exceed the “floor,” the FHA sets the maximum loan limit, known as the “ceiling,” at 150% of the conforming loan limit. The 2022 “ceiling” for FHA loans is $970,800.

How to qualify for an FHA loan in Massachusetts

Purchasing a home in Massachusetts with an FHA loan can make it easier for homebuyers to get the home they want. First-time homebuyers also could receive additional assistance through Massachusetts’s first-time homebuyer programs. Before researching those programs, it’s important to make sure you meet these FHA loan requirements:

  • A minimum down payment of 3.5%. If you have a credit score of 580 or higher, your down payment on an FHA loan could be as low as 3.5% of the home’s purchase price. If you don’t have this minimum credit score, you likely will need to pay more for your down payment. Check your credit score here.
  • A minimum credit score of 500. For homebuyers with a credit score between 500 and 579, you could still qualify for an FHA loan, although you’ll likely need at least 10% of the home’s purchase price for the down payment. And while the FHA loan requirements include a minimum credit score of 500, your mortgage lender could actually have a higher minimum credit score requirement.
  • An FHA-approved appraisal. The FHA requires an FHA home appraisal to qualify for the loan. In addition to showing that the value falls in line with the mortgage loan amount, the appraisal also should show the home is currently habitable and will remain habitable for the life of the FHA loan term.
  • A maximum debt-to-income (DTI) ratio of 43%. Mortgage lenders use your DTI ratio to evaluate your ability to pay off your debts, including your mortgage, each month. Generally speaking, the FHA prefers a DTI of 43% or less, although some mortgage lenders could make an exception.
  • Mortgage insurance. FHA loans require two types of mortgage insurance premium payments. The upfront mortgage insurance premium (UFMIP) is 1.75% of the purchase price and annual mortgage insurance premium (MIP) ranges from 0.45% to 1.05% annually.
  • Occupancy. The home you buy with an FHA loan must be your primary residence for at least 12 months after purchase.

Buying a multifamily property with an FHA loan

You could also use an FHA loan to purchase a multifamily home. FHA loan requirements state the multifamily can have between one and four units, and you must live in one of those units for at least one year. The same FHA eligibility requirements apply, including needing a 580 credit score for a down payment of 3.5% of the purchase price.

FHA lenders in Massachusetts

To find a highly rated FHA mortgage lender in Massachusetts, this list is a good place to start. For the full review, click on the lender name.

Lender name LT rating Minimum FHA credit score 
Carrington Mortgage Services8/10500
Rocket Mortgage9.5/10580
Guild Mortgage9/10540
PennyMac9/10620
Lower10/10580

 

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