What Is the FHA Loan Limit in Texas?
Navigate FHA loan limits in Texas. This guide helps you understand how these caps define your home buying options in the Lone Star State.
An FHA loan is a mortgage insured by the Federal Housing Administration, a government agency within the U.S. Department of Housing and Urban Development (HUD). These loans are designed to make homeownership more accessible, particularly for first-time homebuyers, by offering features like lower down payment requirements and more flexible credit guidelines compared to conventional loans. The FHA does not directly lend money; instead, it insures loans made by FHA-approved lenders, protecting lenders from losses if a borrower defaults.
FHA loan limits are a key component of the program, defining the maximum mortgage amount the FHA will insure for a property in a given area. These limits are primarily based on 115% of the median home price in a specific area and account for variations in property types. The purpose of these limits is to ensure the FHA remains focused on providing affordable housing options and managing financial risk.
How FHA Loan Limits Are Determined
The FHA establishes a “national floor” and a “national ceiling” for these limits across the United States. For 2025, the national floor for a one-unit property is $524,225, while the national ceiling is $1,209,750 in designated high-cost areas. These benchmarks ensure a minimum insurable amount in less expensive areas and a maximum in high-cost areas. Multi-unit property limits are proportionally higher; for example, a two-unit property has a low-cost limit of $671,200 and a high-cost limit of $1,548,975 in 2025.
HUD annually reviews and updates these limits to reflect changes in housing markets. Annual adjustments ensure the FHA loan program adapts to evolving real estate values and continues to meet homebuyer needs. The methodology involves analyzing median home prices and conforming loan limits set by the Federal Housing Finance Agency (FHFA).
Counties are categorized based on housing costs, which influences the FHA loan limit. Counties may fall under the national floor, between the floor and ceiling, or qualify for higher ceiling limits based on median home prices. This localized approach provides appropriate financing options across diverse economic regions. Determination considers the property’s county or Metropolitan Statistical Area (MSA).
Locating Texas FHA Loan Limits
To find current FHA loan limits for specific areas in Texas, consult official sources. The most reliable resource is the HUD website, which provides a search tool for homebuyers to determine the maximum FHA-insurable loan amount for their desired location and property type.
To use the HUD tool:
Navigate to the FHA Mortgage Limits page.
Select “Texas” from the state dropdown menu.
Input the specific county where the property is located.
Ensure “Limit Type” is set to “FHA Forward” and the correct calendar year is selected.
Search results display FHA loan limits categorized by the number of units in the property. This includes separate limits for one-unit, two-unit, three-unit, and four-unit properties. For 2025, many Texas counties will align with the national floor of $524,225 for a single-family home. However, some high-cost Texas counties may have limits up to $571,550 or even $692,300 for a single-family residence.
For multi-unit properties in Texas, limits also vary by county and are generally higher than for single-unit homes. For example, a two-unit property in a standard Texas county might have a limit of $671,200, while a high-cost county could see this rise to $731,700 for 2025. This breakdown helps homebuyers understand how much they can borrow with an FHA loan based on property type and location.
Applying FHA Loan Limits to Your Home Purchase
Understanding FHA loan limits for your Texas location is a practical step in homebuying. Once identified, this information directly influences your property search and financing strategy. The FHA loan limit represents the maximum amount the FHA will insure for your mortgage.
If a property’s purchase price exceeds the FHA loan limit for its area and unit type, an FHA loan cannot finance the entire amount. For example, if the FHA loan limit in your Texas county for a single-family home is $524,225, and you wish to purchase a home for $550,000, the FHA loan would not cover the full purchase price. You would need to cover the difference with a larger down payment or explore alternative financing, such as a conventional loan.
Lenders use FHA loan limits during mortgage application pre-approval and underwriting. They determine the maximum FHA-insurable loan amount you qualify for, ensuring it does not exceed the limit for your property’s location and unit count. Awareness of these limits helps set realistic expectations for your home search and prevents pursuing properties outside the FHA program’s parameters.
Annual FHA loan limit adjustments can impact purchasing power, especially in areas with rising home values. Increased limits allow buyers to finance higher-priced homes with FHA loan benefits, like lower down payments. Conversely, if limits do not keep pace with local market appreciation, the range of eligible properties may narrow. Staying informed about current limits is beneficial when planning a Texas home purchase.