Which of the following is true about FHA loan limits?
Correct Answer
C) They vary by county and are based on local median home prices
FHA loan limits vary by county and are based on local median home prices, with floors and ceilings established by HUD. They are typically lower than conforming loan limits and are designed to serve low-to-moderate income borrowers in each market.
Why This Is the Correct Answer
FHA loan limits vary by county and are based on local median home prices, with floors and ceilings established by HUD. They are typically lower than conforming loan limits and are designed to serve low-to-moderate income borrowers in each market.
More Mortgage Knowledge Questions
A borrower is comparing two loan offers: Loan A has no points and 4.5% interest rate, Loan B has 2 points and 4.0% interest rate. The loan amount is $400,000. How much will the borrower pay upfront for the points on Loan B?
A lender charges a 1% origination fee on all loans. For a borrower obtaining a $250,000 mortgage, what is the maximum origination fee that can be charged without violating the points and fees test under the ATR/QM rule for a first-lien mortgage?
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A borrower asks about the difference between discount points and origination fees. What is the most accurate explanation?
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Which of the following best describes how conforming loan limits are determined for high-cost areas?
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On the URLA Form 1003, Section VIII covers assets. A borrower lists '$50,000 in cryptocurrency' as their primary asset for down payment. How should the MLO address this for application purposes?