Question:

What are the HUD median income limits used for?

Answer:

HUD area median income limits (AMIs) are provided to Fannie Mae to determine applicant eligibility for specific Fannie Mae products. 2007 HUD median income limits are the most recently announced. Due to change in the calculation method, some 2007 HUD AMIs are higher than 2006 limits.

How are the HUD median income limits used?

Fannie Mae has community lending programs, targeting low and moderate income families. The general rule is that qualified households cannot exceed 100% of the area median income. Higher HUD median income limits apply to high cost areas. In several other cases, when down payment or closing costs assistance is provided, local lending programs rules apply. There are specific HUD-underserved areas and hurricane impacted areas, targeted by Fannie Mae and more flexible underwriting criteria apply.

HUD median income limits are also used as a criterium for loans extended for multifamily rental housing - such as Bond Credit Enhancement, Multifamily Affordable Housing Forwards, and others.

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