California FHA Loan Limits

California FHA Loan Limits

Key Topics In This Article: Loan Limit | High-Cost Counties | Previous Years | Is An FHA Loan Right For You?

The Federal Housing Administration (FHA) issued its 2024 California FHA loan limits, and the good news for homeowners is that they’ve increased their limits for most areas. The FHA increase in loan limit size is a big win for homeowners in California as it will open the door to additional opportunities for many current and potential homeowners.

2024 FHA Loan Limits In California

Here are the baseline and high-cost county California FHA loan limits.

  • $498,257 (baseline) most counties
  • $1,149,825 in some high-cost counties

The 2024 California FHA loan limit increase will open the door to more homeowners who want access to the FHA loan program. These limits apply to purchase and refinance transactions throughout the state of California.

FHA Nationwide

The FHA nationwide increase from the previous level of $472,030 to $498,257 is just over a $25,000 increase. In high-cost areas, the FHA loan limit goes from $1,089,300 to $1,149,825 – that is an increase of over $118,000!

This increase will allow homeowners new opportunities and should help keep housing stable. Multi-decade high mortgage rates did not deter home prices from moving higher, and if rates improve in 2024, that trend may continue.

The most popular Federal Housing Administration loan program is the 30-year fixed-rate loan program and the 15-year fixed-rate loan program, and those will continue to be offered in 2024.

Why the increase?

According to the Federal Housing Finance Agency (FHFA) the price index, the price of homes continues to rise. Every year, FHFA announces an update to loan limits; some years, it increases, and some years, it remains flat.

If you’d like a county-by-county breakdown (for each state), then check out the easy-to-use search function on HUD’s website. Before raising the FHA loan limits, the Federal Housing Finance Agency raised Conforming loan limits across the country to $766,550. That is a sizable increase and it ultimately will help thousands of homeowners in California.

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FHA Loan Limits High-Cost Counties

If you live in one of the high-cost counties and want an FHA loan amount between $498,257 and $1,149,825, you are going to pay a higher interest rate than someone who has a loan amount at or below $498,257. The process and general qualifications are the same, but the interest rate is higher.

How Much Higher?

It mostly depends on the market, but generally speaking, your interest rate is going to be between 0.125% and 0.375% higher than those with a loan amount at or below $472,030.

As it’s been reported in the news, we’ve seen significant jumps in housing prices over the last 12 months, and because of this, FHA is able to raise its floor and ceiling loan limits.

California FHA Loan Limits For Previous Years

Below are the FHA loan limits in California from 2018 – 2024.

2024 FHA loan limits in California

  • $498,257 (baseline limit)
  • $1,149,825 (high-cost counties)

2023 FHA loan limits in California

  • $472,030 (baseline limit)
  • $970,800 (high-cost counties)

2022 FHA loan limits in California

  • $420,680 (baseline limit)
  • $970,800 (high-cost counties)

2021 FHA loan limits in California

  • $356,360 (baseline limit)
  • $822,375 (high-cost counties)

2020 FHA loan limits in California

  • $331,760 (baseline limit)
  • $765,600 (high-cost counties)

2019 FHA loan limits in California

  • $314,827 (baseline limit)
  • $726,525 (high-cost counties)

2018 FHA loan limits in California

  • $294,515 (baseline limit)
  • $679,650 (high-cost counties)

Is An FHA Loan Right For You?

An FHA loan is not for everyone; however, it does provide an opportunity for thousands of Californians every year to either refinance their current mortgage or purchase a new home.

FHA loan programs typically come with lower rates (compared to conforming loan programs); however, they do come with Mortgage Insurance (MI). More on what Mortgage Insurance is below.

Mortgage Insurance

Do you know FHA loans come with Mortgage Insurance?

Mortgage Insurance (MI) is not homeowners insurance. Mortgage Insurance is an insurance policy that you pay each month (along with your mortgage payment, property taxes, and property insurance) that protects the lender in case you default on your loan.

While no one wants to pay an extra payment each month, the FHA loan program does open the door to new opportunities for those with less-than-perfect credit, high debt-to-income ratios, and/or low downpayment.

The program is not perfect, but it is great for certain current and potential homeowners. All FHA loan limits in California, standard and high cost, are subject to Mortgage Insurance – no exceptions.

There is also an Upfront Mortgage Insurance Premium that is paid at the time of closing. The payment is one lump sum and is either added to the loan, or the interest rate is increased to cover the cost.

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Paying Off An FHA Loan

When you go to pay off an FHA loan under the old FHA loan limits in California and the new limits for 2021, you’ll owe daily interest. Unlike Conforming loans, you’ll owe daily interest for the entire month no matter what day you close. For conforming loans, you’ll only owe interest on the day your loan is paid off.

So, if you are selling your home or if you are refinancing your current mortgage, and you have an FHA loan, you’ll want to close and pay the original FHA mortgage at the end of the month (rather than the first few weeks).

FHA Streamlined Refinance

One of the best refinance options in California is the FHA Streamline Refinance loan program. If your current mortgage is an FHA loan, then you’ve met the main requirement for the program. No appraisal, no income documentation, and a super fast closing. You can also refinance if you owe more than the home is worth.

VA home loans have a similar program. The VA Streamline Refinance allows a veteran, active service member, or surviving spouse the opportunity to refinance their current VA loan at a lower rate without an appraisal.

Bottom Line On FHA Loan Limits In California

FHA home loans are not for everyone, but they are a great option for most California home buyers and homeowners. FHA loan limits in California generally increase year after year due to the increase in home values throughout California.

At JB Mortgage Capital, Inc., we offer low FHA mortgage rates and one-on-one personal service. If you are looking for a new FHA mortgage, please be sure to give us a call at 1-800-550-5538 or use one of our “contact us” forms.

Loan Officer Kevin O'Connor

About The Author

Loan Officer Kevin O'Connor has over 17 years of experience as a Mortgage Loan Originator and is a trusted resource for mortgage education and information. He's licensed by the state of California and the Nationwide Mortgage Licensing System. He has a top rating with the Better Business Bureau, Google, Yelp, and Zillow. You can contact him at 1-800-550-5538. CA DRE #01499872 / NMLS #247447