Table Two to Four Units Fannie Freddie Maximum Loan Amounts

Units Lower 48 States (Loan Limit $) AK, HI, VI (Loan Limit $)

1 417,000 625,500

2 533,850 800,775

3 645,300 967,950

4 801,950 1,202,925

Because most borrowers prefer this type of housing, loan reps forget to mention that these megaplayers in the mortgage market also give their lowest rate financing to borrowers who own and occupy two- to four-unit properties (see Table 3.10). In addition, Fannie/Freddie establish higher limits for Alaska, Hawaii, and the Virgin Islands.

FHA permits higher loan amounts for two- to four-unit properties, too (see Table 3.11). Even though multi-unit loans can exceed the maximum FHA single-family (and Fannie/Freddie) loan limits, many lenders do not charge a jumbo premium for these mortgages.

Remember that jumbo loans on single-family houses and condos not only charge higher interest, they may require 10 to 30 percent down. You can finance two- to four-unit properties with a 5 to 10 percent down payment. You'll enjoy faster equity buildup, larger amounts of appreciation, and a conventional interest rate. Two to four units make sense.

Table 3.1

Units

1 One to Four Units: FHA Maximum Loan Amounts (2007)

Basic Limits Highest Cost Areas

1

200,160

362,790

2

256,248

464,449

3

309,744

561,411

4

384,936

697,696

Unlike Fannie/Freddie, FHA designates its maximum the United States. For the latest figures, go to hud.gov

loan amounts county by county throughout

As I have urged before, more homebuyers and investors should profit with these properties.

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