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2019 FHA Loan Limits in Maryland

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Maryland offers everything from laid-back rural settings to oceanside living to bustling city life. If you’re thinking about buying a home in Maryland, you may be considering an FHA loan. FHA loans are attractive because their requirements for a down payment are lower than conventional loans. They also have lower minimum credit score requirements.

FHA loans are a popular choice for many Maryland homeowners. In fact, 30.7% of all mortgages in Maryland are FHA loans, which makes it the fifth-highest state when it comes to the percentage of homeowners using FHA loans, according to a 2016 report from the Department of Housing and Urban Development (the most recent report available).

If you think you might want an FHA loan, it’s helpful to understand FHA loan limits. The FHA sets limits on the amount of money it will lend for a mortgage. Although FHA loans are not conforming loans, the agency sets its limits based on Freddie Mac and Fannie Mae’s conforming loan limits. Those limits are calculated each year using a formula that was established by the Housing and Economic Recovery Act of 2008.

The conforming loan limits change each year to reflect changes in the average home price. The FHA loan limits have a “floor,” which is the maximum loan amount in lower cost areas, and a “ceiling,” which is the maximum loan amount in high-cost housing areas.

Maryland real estate pricing varies widely. Six of Maryland’s 24 counties have limits at the “floor,” which in 2019 is $314,827. Five Maryland counties are at the “ceiling,” or the highest allowed amount, which is $726,525 in 2019. The rest of Maryland falls somewhere in between, depending on the median home price in that area.

Maryland FHA Loan Limits by County

County NameOne-FamilyTwo-FamilyThree-FamilyFour-FamilyMedian Sale Price
ALLEGANY$314,827$403,125$487,250$605,525$96,000
ANNE ARUNDEL$517,500$662,500$800,800$995,200$450,000
BALTIMORE$517,500$662,500$800,800$995,200$450,000
BALTIMORE CITY$517,500$662,500$800,800$995,200$450,000
CALVERT$726,525$930,300$1,124,475$1,397,400$768,000
CAROLINE$314,827$403,125$487,250$605,525$157,000
CARROLL$517,500$662,500$800,800$995,200$450,000
CECIL$402,500$515,250$622,850$774,050$350,000
CHARLES$726,525$930,300$1,124,475$1,397,400$768,000
DORCHESTER$314,827$403,125$487,250$605,525$149,000
FREDERICK$726,525$930,300$1,124,475$1,397,400$768,000
GARRETT$314,827$403,125$487,250$605,525$163,000
HARFORD$517,500$662,500$800,800$995,200$450,000
HOWARD$517,500$662,500$800,800$995,200$450,000
KENT$314,827$403,125$487,250$605,525$210,000
MONTGOMERY$726,525$930,300$1,124,475$1,397,400$768,000
PRINCE GEORGE'S$726,525$930,300$1,124,475$1,397,400$768,000
QUEEN ANNE'S$517,500$662,500$800,800$995,200$450,000
SOMERSET$336,950$431,350$521,400$648,000$293,000
ST. MARY'S$347,300$444,600$537,400$667,900$278,000
TALBOT$382,950$490,250$592,600$736,450$305,000
WASHINGTON$314,827$403,125$487,250$605,525$185,000
WICOMICO$336,950$431,350$521,400$648,000$293,000
WORCESTER$336,950$431,350$521,400$648,000$293,000

How are FHA loan limits calculated?

FHA loan limits are a percentage of the Fannie Mae and Freddie Mac conforming loan limits. The 2019 conforming loan limit for single-family homes is $484,350.

To calculate the FHA national loan floor in low-cost areas, they multiply the conforming loan limit by 65%, which comes to $314,827. The ceiling — the loan limit for areas with higher home costs — is set at 150% of the conforming loan limit, which is $726,525.

Because Maryland housing prices mirror those that are used to calculate the national FHA loan limits, the state’s FHA loan limits are the same as the national limits: $314,837 for low-cost areas and $726,525 for high-cost areas.

Are you eligible for an FHA loan in Maryland?

To be considered for an FHA loan, your lender will consider the price of the home you’re buying, as well as other factors, including your down payment, credit history, credit score and income. To learn more about FHA loans, how they work and whether an FHA loan might be right for you, visit MagnifyMoney’s guide to FHA loans.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Melinda Sineriz
Melinda Sineriz |

Melinda Sineriz is a writer at MagnifyMoney. You can email Melinda here

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How Credit Report Disputes Can Sabotage Your Chance for a Mortgage

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Mortgage underwriting can feel like it’s taking a lifetime when it’s standing between you and your dream home. But your lender wants to make sure that you’ll be able to repay the loan, so they’ll take the time to go over your credit history with a proverbial magnifying glass.

Before you get to underwriting, you’ll want to make sure you’re a creditworthy borrower. This means maintaining a good payment history, paying down debt and disputing any errors on your credit report.

However, credit report disputes can impact your ability to get a mortgage if they’re still pending when you’re applying for a loan. This guide will explain how and why.

Why your credit reports and scores matter

One of the first things lenders look at is your credit report, which provides information about your credit history. It details whether you’ve made on-time payments on credit cards, loans and other accounts.

The information included in this report is summed up by a credit score that generally ranges between 300 and 850. The higher your score, the more creditworthy you are perceived to be.

Although credit scores aren’t the only factor that determines whether you’ll qualify for a mortgage, your credit score heavily influences the mortgage interest rate you receive. The highest scores qualify borrowers for the best mortgage rates.

Before you begin the homebuying process, it’s smart to review your credit report and have a copy handy. You can request a free credit report once a year from each of the three major credit reporting bureaus, Equifax, Experian and TransUnion, at AnnualCreditReport.com.

It’s critical to arm yourself with this information in advance. That gives you the opportunity to dispute any inaccuracies you’ve discovered and clean up your report.

What is a credit report dispute?

Credit report inaccuracies are relatively common. Inaccurate information can happen for a variety of reasons — a credit card payment being applied to the wrong account or duplicate accounts in your report giving the impression that you carry more debt than you actually do, for example.

Not only can errors harm your credit score, but they can prevent you from qualifying for a new credit account, such as an auto or home loan. That’s why it’s important to regularly keep track of the information found in your credit reports.

When you review your credit report and find an error, you have the opportunity to formally dispute it under the Fair Credit Reporting Act This is the first step to take to get the error corrected or removed.

Fortunately, it’s easier than ever to file a credit dispute with all three credit reporting agencies online.

How to file a credit report dispute

If you’ve found an error on your credit report, take the following steps to dispute it:

  1. Provide your contact information.
  2. Identify the items in your credit report that are inaccurate.
  3. Explain why you’re disputing the info and include documentation to support your dispute.
  4. Request a correction or deletion.

You’ll also want to reach out to the creditor that is reporting inaccurate information to the credit bureaus. Let them know you’re disputing the information and provide them the same documentation you’re giving to the bureaus.

In many cases, the credit bureaus investigate disputes within 30 days, according to myFICO.com.

However, many disputes can go unresolved for long periods of time, which can be troublesome for consumers applying for a mortgage. Many loan applicants don’t realize an open credit report dispute can raise a red flag to lenders and may even prevent mortgage approval.

When to file a credit report dispute

You’ll want to file a dispute as soon as you spot an error on any of your credit reports, but if you’re thinking about buying a home in the near future, it’s best to exercise caution when filing disputes, especially right before you apply for a mortgage.

Although the dispute investigation can wrap up in 30 days, it could last as long as 90 days, so it’s best to avoid filing new disputes a few months prior to starting the homebuying process.

How mortgage lenders view credit disputes

When a dispute is filed, credit reporting agencies are required to label the item as “in dispute.” The dispute itself doesn’t impact your FICO Score. However, your score may temporarily deflate or inflate while the disputed items are being investigated.

Mortgage lenders know credit reports with disputed items don’t paint the most accurate picture of a consumer’s creditworthiness and many require this status be removed before approving a mortgage application. This leaves some consumers with a difficult decision to make — accept costly credit report errors or delay applying for a loan until disputes have been resolved.

Here’s how lenders who provide conventional and FHA loans consider credit report disputes when determining whether a consumer qualifies for a mortgage.

Conventional loans

Both government-sponsored enterprises, Fannie Mae and Freddie Mac, have automated underwriting systems that alert lenders to existing credit report disputes. These entities don’t issue loans, but buy mortgages from lenders that follow their rules.

Fannie Mae’s system initially reviews all accounts on a borrower’s credit report, even those that are being disputed. If the borrower would be approved for the loan even with the account in question, the loan moves forward. But if the disputed account would push the borrower into the “rejection” category, the system will direct the lender to investigate whether the dispute is valid.

Lenders using Freddie Mac’s system are required to confirm the accuracy of disputed accounts. The borrower would need to have the accounts corrected before the loan can move forward.

FHA loans

FHA-approved lenders require borrowers with disputed delinquent accounts on their credit report to provide an explanation and supporting documentation about their dispute. If the account has an outstanding balance of more than $1,000, the loan must be manually underwritten, which means the loan officer has to review the loan application and supporting documents outside of the automated system.

The loan officer goes over the paperwork included in the borrower’s file very closely to determine their risk of mortgage default and whether they qualify for the loan program that they’re applying.

Disputed medical accounts are excluded from consideration, but disputed accounts that are paid on time must be factored into the borrower’s debt-to-income ratio.

How to remove a lingering credit report dispute

Gaining access to a new credit report with updated information is not an option for the borrower if the creditor won’t correct the information. And when a consumer files a complaint with the credit reporting agencies, the agencies will often defer to the creditor.

Just as you’ve reached out to your creditor and the credit reporting bureaus to file your dispute, you’ll want to take the same action to remove it. Contact the creditor directly and request that they update the account information to show that it’s no longer being disputed.

You may also want to reach out to Equifax, Experian and TransUnion to request dispute removal, but keep in mind they may also reach out to the creditor who is reporting the disputed account. See the FICO website for more information about contacting each bureau’s dispute department.

The bottom line

Dealing with an unresolved credit report dispute can turn into a consumer nightmare. Even if you’ve followed best practices, you may still be unhappy with the results.

Fortunately, you can still submit a complaint to the Consumer Financial Protection Bureau. They will forward your complaint directly to the company in dispute and work to get a response from them. Another option is to seek guidance from a consumer advocate or an attorney. The National Foundation for Credit Counseling may be a helpful place to start.

Credit reports and scores have such a strong influence on lifelong financial health, so the most effective defense is to be proactive about making sure yours are in the best shape possible. Regularly monitoring your credit profile and working to fix inaccuracies before applying for a mortgage is a good game plan to prevent major problems as you embark on the homebuying process.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Crissinda Ponder
Crissinda Ponder |

Crissinda Ponder is a writer at MagnifyMoney. You can email Crissinda here

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