Federal Housing Administration updates: How mortgagee letters change FHA rules

Written by Samantha SheltonNMLS 1647301Updated October 2026

FHA changes its rules through numbered documents called Mortgagee Letters, and a letter controls from its own stated effective date, even while HUD’s posted Single Family Housing Policy Handbook 4000.1 still shows the old text. Mortgagee Letter 2025-23, dated December 11, 2025, set FHA’s 2026 one-unit loan limits at a $541,287 floor and a $1,249,125 ceiling for case numbers assigned on or after January 1, 2026.

That gap is the most useful thing to understand about Federal Housing Administration updates. Every letter carries the same promise, that its updates “will be incorporated into a forthcoming update” of Handbook 4000.1, and forthcoming can mean months.

Learn how FHA publishes a rule change, which document controls when the two disagree, and how to verify any claimed change yourself. Our industry updates and rules hub tracks changes outside FHA.

Key takeaways:

• The letter controls from its effective date: ML 2025-23 governs case numbers assigned on or after January 1, 2026, setting a $541,287 one-unit floor and a $1,249,125 ceiling, and roughly 8 months passed before it reached the posted handbook.
• The handbook catches up in batches: HUD republished Handbook 4000.1 on August 12, 2026 as Update 18, folding in months of accumulated letters at once and giving lenders until November 10, 2026 to implement every change that did not already carry a letter’s own effective date.
• Read the date stamp before trusting a section: Handbook 4000.1 prints an effective date in parentheses after every fourth-level heading, which is how you confirm the section holding the credit score rule, II.A.2.b, Loan-to-Value Limits, still reads 02/16/2021.

How does FHA publish a rule change?

Through a Mortgagee Letter, numbered ML YYYY-NN in the order issued that year.¹ ML 2026-08 was the eighth letter of 2026. Anything that changes what FHA insures, what lenders must document, or how servicers treat a delinquent borrower arrives this way.

Every letter uses the same skeleton, and three blocks do the work:

• Effective Date: The block that matters most, written three ways: effective immediately, effective for case numbers assigned or endorsed on or after a date, or may be implemented immediately but must be implemented by a date. Those triggers are not interchangeable.
• Summary of Changes: The exact Handbook 4000.1 sections being rewritten, such as II.A.2.a.ii or III.A.2.i.iii(C).
• Handbook 4000.1: The replacement text itself, under the heading “The policy changes will be incorporated into Handbook 4000.1 as follows.”

That last block is why a Mortgagee Letter is not a press release: it carries the operative handbook language, so HUD is publishing the edit, not describing it. FHA policy also travels through FHA INFO messages and HUD news releases, but those are notice of a change.

What is Handbook 4000.1, and why can it lag its own letters?

Handbook 4000.1 is FHA’s consolidated rulebook for single-family lending, roughly 1,800 pages in its August 12, 2026 version, Update 18, covering lender approval, origination, appraisal, servicing, claims and quality control. The lag is structural: HUD publishes letters continuously and republishes the handbook in batches, so the posted PDF is stale by design between updates.

The August 12, 2026 update shows the batching. Handbook 4000.1 moved from a last-revised date of November 26, 2025 straight to August 12, 2026, absorbing letters that had been in force since January, and new date stamps of 11/10/2026 appear against the sections it rewrote. That is the implementation rule in practice: changes made to reflect a letter stay effective as previously announced in the corresponding Mortgagee Letter, while everything else may be implemented immediately but must be implemented no later than November 10, 2026. Note that absorption into the handbook and formal supersession are two different steps. A letter is only retired once HUD moves it to the Single Family Housing Superseded Policy Documents page, and as of this writing every 2026 letter, plus ML 2025-24, is still on HUD’s active Mortgagee Letters index.

Two details from that update show how HUD handles figures that move yearly:

• Loan limits left the handbook entirely: Section II.A.2.a.ii, Nationwide Mortgage Limits, was updated “to include an evergreen hyperlink in lieu of including loan limits in the handbook annually,” and no longer prints a dollar figure. HUD fixed a staleness problem by deleting the stale field, so current-year limits belong to the letter or HUD’s lookup tool. Our guide to FHA loan limits covers the county math.
• Some static text needs the letter read alongside it: Appendix 1.0, Mortgage Insurance Premiums, still carries its 03/20/2023 stamp and a $726,200 base loan amount threshold, the conforming baseline when ML 2023-05 was written, while that letter says it “amends the Base Loan amount threshold used to establish MIP rates to the national conforming loan limit.” Near that line, ask your lender which figure they apply.

Which document controls when the letter and the handbook disagree?

The Mortgagee Letter, from the date it names. A letter can also rescind an earlier letter and restore the language that preceded it, which is how reading only the handbook leaves you a policy cycle behind. HUD’s foreclosed-home listing rules show the chain:

• ML 2022-01 and ML 2022-08, January 13 and May 5, 2022: ML 2022-01 expanded the REO exclusive listing period, the window when only owner-occupant buyers, HUD-approved nonprofits and government entities may bid, from 15 days to 30 days. ML 2022-08 established a parallel 30-day exclusive sales period inside the Claims Without Conveyance of Title post-foreclosure process.
• ML 2025-13, April 28, 2025: Replaced both. HUD’s data showed few properties selling to owner-occupants during the longer window while holding costs and deterioration climbed, so the letter rescinded the newer language and restored the previous. The exclusive period returned to 15 days for properties marketed as insured or insured with escrow, and five days for uninsured, for listings on or after May 30, 2025.

Note the two dates. April 28, 2025 is when the letter was signed; May 30, 2025 is when it bound anyone. Confusing them is the most common error in write-ups of FHA changes. Our guide to buying a foreclosed home covers the bidding, and the foreclosure process explainer shows how a property reaches HUD.

Recent FHA mortgagee letters and what each one changed

Seven letters from April 2025 through June 2026 account for most of what a borrower, agent or servicer would notice.

Three deserve translation. ML 2026-07 removed a disclosure form from your application packet as duplicative of Truth in Lending Act disclosures. ML 2026-06 matters if you are renovating: FHA raised the Limited 203(k) cap to $75,000 in ML 2024-13 without changing the two-draw limit, so the newer letter allows four draws per contractor. See how FHA 203(k) loans work. ML 2026-10 changes quality control lenders run behind the scenes, not what your appraiser looks at, covered in our home appraisal process guide.

If your file is already delinquent, read ML 2026-08 closely. It made failing to accept a Trial Payment Plan agreement a third time during one default episode an automatic failure, and requires servicers to deliver that agreement at least 15 days before the first payment is due. Making the first payment is acceptance; no signature required.

Which FHA letters arrived after the August 2026 handbook update?

Two, according to HUD’s Mortgagee Letters index: ML 2026-11 and ML 2026-12. Neither is in Update 18. ML 2026-11, dated October 8, 2026, says its updates “will be incorporated into a forthcoming update” of Handbook 4000.1, and ML 2026-12 says the MAP Guide, HUD’s multifamily processing guide, will be revised to include it.

Source: HUD Mortgagee Letter 2026-11, October 8, 2026, and HUD Mortgagee Letter 2026-12, as listed on HUD’s Mortgagee Letters index.

ML 2026-12 shows that not every letter touches a home purchase loan. It opens Section 221(d)(4) new construction, and Section 223(f) for properties with a certificate of occupancy dated less than 3 years before the application, to rental communities of five or more dwelling units on one contiguous site run as one property, with no sale of parcels or buildings allowed during the insured loan term. HUD wrote it in response to Section 3 of Executive Order 14376, signed January 20, 2026 and published at 91 FR 3023, which directs HUD and other agencies to issue guidance including “narrowly tailored exceptions for build-to-rent properties.”

How will FHA’s credit score rule work with three score models?

From January 1, 2027, per ML 2026-11, a lender may submit Classic FICO, VantageScore 4.0, FICO 10T or a mix, provided the same model types are used for every borrower; the letter’s own example is that a lender may not submit FICO 10T for the primary borrower and VantageScore 4.0 for the co-borrower. FHA still requires a tri-merge credit report, and the letter states that “the existing minimum credit score thresholds remain unchanged regardless of Credit Score Model Type.” A file whose Minimum Decision Credit Score is below 500 stays ineligible. The same letter restates the refinance table: at or above 580, eligible for maximum financing of 97.75%; 500 to 579, limited to 90% loan-to-value.

The selection runs in three steps under ML 2026-11:

• Within each model: three differing scores, use the middle one; two differing scores, use the lower; one score, use it.
• Borrower-Level Score: the smaller of the scores selected from each model submitted.
• Minimum Decision Credit Score: the minimum Borrower-Level Score among all borrowers. A co-borrower with no credit score at all is left out of that comparison.

Hypothetical example, not an offer. A lender submits two models for one borrower. Classic FICO reports 612, 598 and 605, so the middle score, 605, is selected. VantageScore 4.0 reports only two scores, 590 and 601, so the lower, 590, is selected. The Borrower-Level Score is 590, the lower of the two selections, which still sits at or above FHA’s 580 line for maximum financing. Because the rule keeps the minimum selection, submitting a second model can hold the decision score or lower it, never raise it.

What did not change in FHA’s recent updates

The core borrower terms. Handbook 4000.1’s date stamps prove it, because an unrewritten section keeps its old date:

• Credit score and down payment, stamped 02/16/2021: Section II.A.2.b, Loan-to-Value Limits, still says a minimum decision credit score at or above 580 is “eligible for maximum financing,” and one between 500 and 579 is “limited to a maximum LTV of 90%.” Maximum financing on a purchase is 96.5% loan-to-value, so 3.5% down at 580 and 10% down at 500 to 579 are unchanged. Compare routes in low down payment mortgages.
• The 3.5% minimum required investment, stamped 09/14/2015: Section II.A.2.c, Required Investment, still carries its 09/14/2015 date. Your contribution of at least 3.5% of adjusted value comes from Section 203(b)(9) of the National Housing Act, not from a letter, which is why no letter can move it.
• Mortgage insurance: The upfront premium remains 175 basis points, or 1.75%, of the base loan amount, and the annual premium still runs on the ML 2023-05 chart effective for case numbers endorsed on or after March 20, 2023.
• Term and ratios: Thirty years maximum. On manually underwritten files, borrowers below 580 or with no credit score cap at 31/43, while 580-and-above files stretch to 40/50 with two compensating factors. Our debt-to-income ratio walkthrough shows what counts.

Hypothetical example, not an offer. In dollars: on a $250,000 Waterford home, the 3.5% minimum required investment is $8,750, the base loan amount is $241,250, and the upfront premium adds $4,221 financed in, for a total mortgage of $245,471.²

No mortgagee letter sets your interest rate. FHA writes program rules; lenders price loans. Rate locks, extension fees and float-downs are lender terms. The Freddie Mac Primary Mortgage Market Survey is the standard weekly benchmark, and our mortgage rates guide explains what moves your quote.

What does FHA’s annual report show about the borrowers it insures?

FHA reports to Congress each fiscal year on its Mutual Mortgage Insurance Fund, and the FY 2025 annual report, covering the year ended September 30, 2025, gives the profile below.

Source: HUD, Annual Report to Congress Regarding the Financial Status of the Mutual Mortgage Insurance Fund, FY 2025, Exhibits O-6, O-13 and O-16, data as of October 2025.

Credit scores are, according to the report, “the most predictive factor” FHA uses for losses, ahead of loan-to-value and debt-to-income ratios, so ML 2026-11 touches the factor the report ranks first. And with 83.03% of FHA purchase loans in FY 2025 going to first-time buyers, per the same HUD report, rules on mortgage insurance and the application packet mostly reach people buying a first home. Our guides to FHA loans and mortgage insurance cover both.

What does FHA’s data show about repeat loss mitigation?

Repeat workouts are climbing, according to FHA’s FY 2025 report to Congress. In January 2018, 30% of borrowers receiving a new home retention option had received one or more in the prior five years; by September 2025 that share was 66%, and nearly 40% had two or more, meaning a third option in five years. Among serious delinquency episodes, 90 days or more behind, the largest group as of September 2025, 41%, belonged to borrowers who had been seriously delinquent three to six times.

Federal servicing rules apply alongside FHA’s. Regulation X, at 12 CFR 1024.41, bars a servicer from making the first notice or filing for foreclosure until the loan is more than 120 days delinquent, with two narrow exceptions, and when a complete loss mitigation application arrives more than 37 days before a foreclosure sale, the servicer must evaluate it for every available option within 30 days. If you are behind, see what mortgage forbearance means and refinancing after a loan modification.

Announcements, drafts and waivers are not mortgagee letters

Three document types get mistaken for FHA policy changes, and telling them apart is most of the skill.

• An announcement of intent is not a rule: FHA INFO 2026-11, published May 21, 2026, confirmed FHA’s intention to enable VantageScore 4.0 and FICO Score 10T alongside Classic FICO. As of the August 12, 2026 handbook update, no Mortgagee Letter implementing that change appeared on HUD’s 2026 list. ML 2026-11, dated October 8, 2026, now implements it for case numbers assigned on or after January 1, 2027; until then, Classic FICO is what FHA requires. Fannie Mae and Freddie Mac ran a separate track on the same models, covered in Federal Housing Finance Agency updates and updates to conventional loan requirements.
• A draft mortgagee letter is a proposal, not policy: FHA posted a draft Reinstatement Advance Payment demonstration mortgagee letter on its Single Family Housing Drafting Table for stakeholder feedback, announced in FHA INFO 2026-16 on July 20, 2026. HUD says plainly that the draft “is not official Departmental policy and cannot be used in connection with any FHA-insured mortgage until finalized.” A document on the Drafting Table has no ML number in force and binds no one.
• Housing waivers suspend handbook text temporarily: HUD can waive a section without issuing a letter. ML 2026-08 revised Trial Payment Plan rules partly “to align with the housing policy waiver published on March 3, 2026,” and the August 2026 transmittal superseded two waivers dated December 11, 2025.

The same discipline applies to housing policy generally: introduced bills and proposed rules are not law until enacted.

How do FHA letters compare with VA circulars and conventional loan updates?

Each program has its own instrument, so the five-minute check below changes shape by loan type.

Sources: HUD Mortgagee Letters; VA Circulars, calendar years 2021 to present; Fannie Mae Selling Guide; FHFA Credit Scores.

How to verify an FHA change yourself in five minutes

1. Get the instrument number. A change described without a Mortgagee Letter number, a Federal Register citation or a statute section is unverified. “FHA announced” is not a citation.
2. Open the letter on hud.gov. The Mortgagee Letters page lists every letter by year and number; retired ones stay on the Single Family Housing Superseded Policy Documents page.
3. Read the Effective Date block, not the letter’s date. The three triggers are not interchangeable.
4. Cross-check the handbook’s date stamp. Find the section the letter names, then read the date in parentheses after that heading. If it predates the letter, the letter governs.

For program basics, HUD’s overview of FHA loan programs is the front door and the CFPB’s home buying tools and resources cover disclosures. Because FHA’s floor and ceiling are 65% and 150% of the conforming baseline, the FHFA conforming loan limit values are the input to FHA’s figures, not the figures themselves. An FHA limit never equals the conforming baseline.

Where does 2026 housing legislation touch FHA?

Congress is changing FHA too, per the Congressional Research Service report Housing for the 21st Century Act, updated October 20, 2026. The House bill (H.R. 6644), passed February 9, 2026, would raise loan limits for several FHA multifamily programs and let HUD run a time-limited pilot to increase access to small-dollar mortgages. On July 11, 2026 the 21st Century ROAD to Housing Act (P.L. 119-101) was enacted with many of the House bill’s elements, others removed, added or modified; CRS covers the enacted law in a separate report, R49354.

What Michigan buyers should know

Michigan is a uniform-limit state for FHA, which makes half of this simple.

• All 83 counties sit at the floor: HUD’s CY2026 forward limits file assigns a one-unit limit of $541,287 to every Michigan county, with $693,050 for two units and $1,041,125 for four. No county here is high-cost, so the $1,249,125 ceiling never applies.
• MSHDA’s overlay is stricter than FHA’s rule: FHA allows a 580 minimum decision credit score for maximum financing; the MSHDA MI Home Loan requires 640, so a borrower at 600 can be FHA-eligible and MSHDA-ineligible at once. See first-time home buyer programs for how the layers stack.
• Down payment assistance pairs with FHA: The MI 10K DPA Loan provides up to $10,000 toward down payment, closing costs and prepaid expenses as an interest-free loan statewide, and must be combined with a MI Home Loan, whose sales price limit is $566,355 after June 1, 2026.
• Older housing stock makes the 203(k) letter relevant: Much of Michigan’s inventory predates 1980, so the draw increase in ML 2026-06 lands harder here. Price the renovation scope before going under contract, and get preapproved first.

How do FHA foreclosures work under Michigan law?

Michigan lets a home foreclosure run outside court. Under MCL 600.3201, a mortgage that contains a power of sale may be foreclosed by advertisement after a default, though that chapter does not apply to mortgages held by the Michigan State Housing Development Authority.

The notice must run in a newspaper published in the county where the property sits, at least once a week for 4 successive weeks, and a copy must be posted in a conspicuous place on the property within 15 days after the first publication, per MCL 600.3208.

The foreclosure sale does not end the owner’s rights. Under MCL 600.3240, for a residential mortgage of 1 to 4 units signed on or after January 1, 1965, the redemption period is 6 months when the amount claimed due is more than 66-2/3% of the original debt; for abandoned property it can be as short as 30 days; and when no shorter rule applies it is 1 year from the sale. A Michigan buyer watching an FHA property that went to a foreclosure sale should expect that window to run first. Our guide to short sales versus foreclosures compares the two routes.

The exact redemption deadline is on the certificate of sale, available at the Register of Deeds in the county where the home sits, and the buyer at the sheriff’s sale will usually be the lender, according to Michigan Legal Help, a nonprofit legal information site.

FAQ: FHA mortgagee letters and Handbook 4000.1

Here are answers to common questions about Federal Housing Administration updates.

What changed with FHA loans recently?

Each verifiable change carries a Mortgagee Letter number. ML 2025-23 set 2026 loan limits, ML 2025-13 restored the 15-day exclusive listing window on HUD-owned homes, ML 2026-03 rewrote servicer bidding at foreclosure sales, ML 2026-06 raised Limited 203(k) draws to four per contractor, ML 2026-07 eliminated form HUD-92900-B, and ML 2026-08 tightened Trial Payment Plan rules. Credit and down payment rules did not move.

What is the FHA down payment requirement?

3.5% of the adjusted value for a minimum decision credit score at or above 580, and 10% for scores between 500 and 579, which cap at 90% loan-to-value. That rule sits at Handbook 4000.1 section II.A.2.b, Loan-to-Value Limits, stamped 02/16/2021, and no mortgagee letter since has changed it. The requirement itself comes from Section 203(b)(9) of the National Housing Act. See FHA loan tips for documentation.

Did FHA loan limits go up for 2026?

Yes. ML 2025-23 set the one-unit floor at $541,287 and the ceiling at $1,249,125, which are 65% and 150% of the $832,750 conforming baseline. FHA publishes a limit for every county, and the handbook no longer prints the figures, having replaced them with a link to HUD’s lookup tool in the August 12, 2026 update. Check your county in our FHA loan limits guide.

How do FHA’s foreclosure rule changes affect buyers?

HUD-owned homes leave the exclusive owner-occupant and nonprofit window after 15 days instead of 30, then open to all bidders including investors, under ML 2025-13 for properties listed on or after May 30, 2025. Uninsured properties get five days. If you want a HUD home, have financing arranged and an agent watching listings. Our guide to buying a foreclosed home covers the bid process.

Where can I find HUD-owned homes for sale?

On HUD Home Store, where HUD lists the homes it owns by state. HUD says you need a HUD-registered selling broker to submit your bid, so a buyer cannot bid alone. Its Good Neighbor Next Door listings offer law enforcement officers, firefighters, EMTs and teachers a 50% discount if they live in the home for three years, according to HUD Home Store.

Do FHA mortgagee letters apply to reverse mortgages?

Only when the letter says so: each one names its reach in an “Affected Programs” block. ML 2026-11, for example, applies to all FHA-insured Title II single-family programs, yet deletes the credit score reference from reverse mortgage eligibility because, the letter states, HECMs “do not rely on credit scores.” HUD reported more than 681,000 reverse mortgages in the FHA portfolio as of September 30, 2025 (HUD No. 25-153). See how reverse mortgages work.

Is FHA’s mortgage insurance fund financially sound?

It clears the bar Congress set. HUD reported an overall capital ratio of 11.47% for the Mutual Mortgage Insurance Fund for fiscal year 2025, more than five times the 2.0% statutory minimum, with $188.9 billion in MMI capital, of which over $100 billion is cash or cash equivalents, according to HUD’s January 2, 2026 release. The forward mortgage ratio alone was 10.95%.

Can a company charge me upfront to help with my FHA mortgage?

Not before the relief is in writing. Under Regulation O, 12 CFR 1015.5, a mortgage assistance relief service provider may not request or receive any fee until you have signed a written agreement with your lender or servicer that includes the relief offer the provider obtained, and it must then tell you in writing that if you reject the offer, you do not have to pay.

The bottom line on Federal Housing Administration updates

FHA changes its rules through numbered Mortgagee Letters, and the letter controls from the effective date it names, even while HUD’s posted Handbook 4000.1 still shows superseded text. ML 2025-23 set the 2026 one-unit floor at $541,287 and the ceiling at $1,249,125 for case numbers assigned on or after January 1, 2026, and the August 12, 2026 handbook update (Update 18) folded months of accumulated letters into the handbook at once with a November 10, 2026 deadline for everything else. The basics held: 3.5% down at 580, 90% loan-to-value at 500 to 579, 175 basis points upfront mortgage insurance, and a 30-year maximum term. When someone says an FHA rule changed, ask for the letter number. For more, see refinancing an FHA loan and the FHA streamline refinance.

If you’re ready to see how these rules apply to your file, talk to Align Lending. We’ll shop your scenario across our lender network and show you the numbers side by side. Call 248-506-5727 or start online.

Footnotes:

1. Align Lending is not acting on behalf of or at the direction of FHA or HUD, and is not affiliated with or endorsed by HUD or the Federal Housing Administration. FHA program terms are set by HUD, are subject to change, and are subject to lender approval. Return to text.

2. Example figures in this article are hypothetical and for educational purposes only; they do not constitute an advertisement of credit terms or a rate quote under federal or state lending laws. The example assumes a purchase price equal to the adjusted value, the 3.5% minimum required investment, and the upfront mortgage insurance premium financed at 175 basis points, and it ignores closing costs, annual mortgage insurance and any lender overlay. Your loan amount, rate and terms will depend on your application, your property and market conditions. Return to text.

Sources: Mortgagee Letter structure, the “will be incorporated into a forthcoming update” language, and all letter dates and effective dates, HUD Mortgagee Letters, hud.gov. 2026 nationwide forward mortgage loan limits, one-unit floor of $541,287 and ceiling of $1,249,125 set at 65% and 150% of the $832,750 conforming limit, two-, three- and four-unit floors of $693,050, $837,700 and $1,041,125, and effectiveness for case numbers assigned on or after January 1, 2026, HUD Mortgagee Letter 2025-23, December 11, 2025. Restoration of the 15-day exclusive listing period for insured and insured-with-escrow HUD REO properties, five days for uninsured properties, replacement of ML 2022-01 and ML 2022-08, and applicability to REO properties listed for sale on or after May 30, 2025, HUD Mortgagee Letter 2025-13, April 28, 2025. Expansion of the exclusive listing period from 15 to 30 days, HUD Mortgagee Letter 2022-01, January 13, 2022, and the parallel 30-day CWCOT sales period, HUD Mortgagee Letter 2022-08, May 5, 2022. FHA Appraiser Roster management updates, HUD Mortgagee Letter 2025-24, December 23, 2025. Foreclosure sale bidding, Claims Without Conveyance of Title, and elimination of the small servicer exception, effective for foreclosure sales scheduled on or after April 29, 2026, HUD Mortgagee Letter 2026-03, January 29, 2026. Limited 203(k) maximum of four draw requests per contractor and the prior $75,000 rehabilitation cap set by ML 2024-13, HUD Mortgagee Letter 2026-06, June 23, 2026. Permanent rescission of form HUD-92900-B and the November 19, 2025 waiver that preceded it, HUD Mortgagee Letter 2026-07, June 23, 2026. Trial Payment Plan failure on a third non-acceptance, the 15-day delivery requirement for the TPP agreement, acceptance by first payment, the March 3, 2026 housing policy waiver, and the September 21, 2026 implementation deadline, HUD Mortgagee Letter 2026-08, June 23, 2026. Removal of lender approval and quality control requirements, HUD Mortgagee Letter 2026-09, June 23, 2026. Removal of the requirement to obtain appraisal field reviews on at least 10 percent of origination and underwriting quality control reviews, HUD Mortgagee Letter 2026-10, June 23, 2026. Upfront mortgage insurance premium of 175 basis points, the annual MIP chart, the $726,200 base loan amount threshold, the amendment of that threshold to the national conforming loan limit, and effectiveness for case numbers endorsed on or after March 20, 2023, HUD Mortgagee Letter 2023-05, February 22, 2023. Handbook 4000.1 last-revised date moving from 11/26/2025 to 8/12/2026, section date stamps of 11/10/2026, and the implementation table making letter-derived changes effective as announced in the corresponding letter and all other changes due no later than November 10, 2026; the replacement of loan limit figures in section II.A.2.a.ii with an evergreen hyperlink; and the User Quick Guide statement that effective dates appear in parentheses at the end of fourth-level headings, HUD Handbook 4000.1, FHA Single Family Housing Policy Handbook, Update 18, and FHA INFO 2026-18, August 12, 2026. Minimum decision credit score of 580 or above for maximum financing and 500 to 579 limited to 90% LTV (II.A.2.b, Loan-to-Value Limits, 02/16/2021); maximum purchase LTV of 96.5% (II.A.2.b.ii); minimum required investment of at least 3.5% of adjusted value under Section 203(b)(9) of the National Housing Act (II.A.2.c, 09/14/2015); maximum mortgage term of 30 years (II.A.2.d, 09/14/2015); upfront premium of 175 basis points and rounding down to the nearest whole dollar (II.A.2.e.i); and manual underwriting qualifying ratios of 31/43 for scores of 500 to 579 or no credit score and up to 40/50 for 580 and above with two compensating factors (II.A.5), HUD Handbook 4000.1, last revised August 12, 2026. FHA’s confirmation of its intention to enable VantageScore 4.0 and FICO Score 10T alongside Classic FICO, previously announced April 22, 2026, FHA INFO 2026-11, May 21, 2026, and HUD news release HUD No. 26-026. Draft Reinstatement Advance Payment demonstration Mortgagee Letter posted on the FHA Single Family Housing Drafting Table for stakeholder feedback and HUD’s statement that the draft is not official Departmental policy and cannot be used in connection with any FHA-insured mortgage until finalized, FHA INFO 2026-16, July 20, 2026, and FHA INFO 2026-19, August 25, 2026. One-unit CY2026 FHA forward mortgage limit of $541,287 in all 83 Michigan counties, HUD CY2026 forward mortgage limits file, hud.gov. MI Home Loan minimum credit score of 640, statewide sales price limit of $566,355 after June 1, 2026, and MI 10K DPA Loan of up to $10,000 as an interest-free loan combined with a MI Home Loan, Michigan State Housing Development Authority, michigan.gov.

This article is for informational purposes only and is not intended to provide legal, financial, or tax advice. FHA policy, loan limits, mortgage insurance premiums and program requirements change and vary by county, property and program; confirm current figures with your lender and consult a qualified professional about your situation. Figures shown are illustrative, are not a rate quote or an offer of credit, and are subject to change. Align Lending is an independent Michigan mortgage broker, NMLS #2041154, and is not affiliated with or endorsed by any government agency.

Related resources

20-minute read

Zoning regulations: How they limit what you can build, add or run at home

Learn how zoning regulations control property use, setbacks and additions, and how to check a home’s zoning classification before you buy or renovate.

Read more

21-minute read

Mortgage regulation updates: what lenders need to know

Learn which mortgage regulation updates matter now, from CFPB servicing and originator rules to FHA, VA and state licensing, and how to stay current.

Read more

21-minute read

The impact of new mortgage regulations on borrowers

Learn how new mortgage regulations affect borrowers, from VantageScore 4.0 credit scoring to FHA loss mitigation limits and the restored PMI deduction.

Read more