2024 FHA Loan Limits in Missouri

For homebuyers with limited funds for a down payment, a Federal Housing Administration (FHA) mortgage can be a useful solution, allowing you to purchase a home with just 3.5% down. However, FHA loans have limits on how much you can borrow, and FHA limits may vary by state and county.

All counties in Missouri have an FHA loan limit of $498,257 for single-family homes. Luckily, that limit should be more than enough. Based on the median sales prices for counties in Missouri, home sales ranged from $116,000 to $427,000, well below the FHA maximum limits.

Missouri FHA loan limits by county

How are FHA loan limits determined?

Each year, the Federal Housing Finance Agency (FHFA) sets the maximum loan limits for conventional mortgages — mortgages that aren’t issued through government programs, rather that are owned or guaranteed by Fannie Mae or Freddie Mac.

FHA loan limits take the conforming loan limit, and metro area home price data into account. Based on these factors, the FHA sets a “floor” and a “ceiling”:

• Floor: The floor is the maximum loan amount the FHA permits in lower-cost areas, and it’s calculated as 65% of the conforming loan limit. Nationally, the floor limit is $498,257 for a one-unit and $958,250 for a four-unit.
• Ceiling: The ceiling is the maximum loan amount for designated high-cost areas, and it’s calculated as 150% of the national conforming loan limit. In high-cost areas, the ceiling for single units is $1,149,825.

Missouri has a relatively low cost of living. According to the Missouri Economic Research and Information Center, it has the sixth-lowest cost of living in the country, and the limit for every county within the state matches the FHA national floor limit of $498,257.

How to qualify for an FHA loan in Missouri

FHA loans are appealing not just because of their low down payment requirements, but also because they can be helpful options for those with less-than-stellar credit. To qualify for an FHA loan, you must meet the following requirements:

→ Credit score: To qualify for the minimum down payment requirement of 3.5%, you must have a credit score of at least 580. You can still get an FHA loan if your credit score is as low as 500, but you’ll need at least 10% of the purchase price as a down payment.

→ Down payment: The minimum down payment required for FHA loans is 3.5%. In Missouri, the median listing price is under $300,000. That means you’ll need to save around $10,000 to meet the 3.5% down payment requirement.

→ Mortgage insurance: To protect lenders against the risk of default, borrowers must have mortgage insurance. For FHA loans, mortgage insurance is paid both upfront and on a monthly basis. Upfront mortgage insurance premium (UFMIP) is 1.75% of the base loan amount, and is usually paid as part of your closing costs. However, you may be able to roll the UFMIP into your mortgage. The monthly cost for insurance ranges from 0.15% to 0.75% of the loan amount, and the lender will add this cost to your monthly mortgage payment.

→ Debt-to-income ratio (DTI): Your DTI ratio reflects how much of your monthly income goes toward debt payments. For FHA loans, the maximum back-end DTI ratio — which takes into account your housing and other monthly debt payments — is 43%.

→ Purpose: Buyers can only use FHA loans to purchase owner-occupied primary residences; you cannot use an FHA loan to buy a second home or an investment property if you don’t intend to live there.

→ Appraisal: The property must meet the U.S. Department of Housing and Urban Development (HUD) minimum property standards for durability and safety, and these standards may be more stringent than local building codes. To ensure the property meets HUD standards, it must undergo an appraisal and inspection. If the inspector identifies any issues, the seller typically needs to complete the necessary repairs prior to closing.

Buying a multifamily property with an FHA loan

Although FHA loans are only for primary, owner-occupied homes, it’s possible to use an FHA loan to buy multifamily properties as long as you intend to live in one of the units. You can rent out one or more of the other units and still qualify for an FHA loan with a down payment as low as 3.5% of the home’s price.

If you want to buy a multifamily unit, you have to meet the borrower requirements for FHA loans, including the following criteria:

• Down payment of at least 3.5%
• Credit score of at least 500 if putting down 10%
• DTI of 43% or lower
• FHA mortgage insurance
• Use of one unit as a primary residence
• Appraisal and inspection

Multifamily units have higher loan limits than single-family units. In Missouri, the maximum FHA loan amounts range from $637,950 for a two-unit to $958,250 for a four-unit.

FHA lenders in Missouri

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