HUD: New FHA loan limit takes effect Jan. 1

Beginning next year, homeowners with Federal Housing Administration loans will no longer be able to qualify for the $729,750 high-cost area loan limit.

Instead, the Department of Housing and Urban Development is implementing a rule passed a few years back that moves the agency's standard loan limit for high-cost areas down to $625,500 for all FHA loans.
The standard loan limit for areas where housing costs are low is expected to remain at $271,050, while the ceiling for FHA-insured reverse mortgages will stay at $625,500, HUD added.

The rule impacts all mortgage assignments issued on or after Jan. 1, 2014.
Approximately 650 counties will face lower loan limits when the standard takes effect, according to HUD.

HUD: New FHA loan limit takes effect Jan. 1