A Guide To Conforming Loan Limits

What Conforming Loan Limits Are and How They Work

Buying a home is a dream for many people, and fortunately, there are resources to help make it a reality. Fannie Mae and Freddie Mac, for example, are two government-sponsored enterprises (GSEs) that help make homebuying more affordable and accessible by establishing conforming loan limits. Take a closer look at what conforming loan limits (CLLs) are, how they work, and how they could impact your mortgage.

Conforming Loan Limits: The Basics

Conforming loan limits (CLLs) set the maximum amount you can borrow with a conventional mortgage Fannie Mae or Freddie Mac can purchase on the secondary mortgage market. These limits are set annually by the Federal Housing Finance Agency (FHFA) and are based on changes in national home prices.

To determine new limits, the FHFA monitors home price trends across the U.S. using its House Price Index (HPI). It adjusts the yearly limits based on how home prices have changed over the past 12 months. Updated limits are usually announced in late November and take effect on January 1st of the following year.

How Conforming Loan Limits Work

Conforming loan limits define the maximum loan amount that can be sold to Fannie Mae or Freddie Mac.

When a mortgage meets these standards, the lender can sell it to these GSEs, freeing up funds to issue new loans. This helps establish consistency across lenders and keeps interest rates from climbing too high.

Loans that exceed the limit are considered jumbo loans and aren’t eligible for purchase by Fannie Mae or Freddie Mac. Instead, they’re usually sold to private investors or held by the lender. Because these loans carry more risk, they often carry higher interest rates and stricter qualification requirements.

As a result, conforming loan limits help keep the mortgage market liquid and stable, so lenders can continue offering loans that help people become homeowners.

Why Conforming Loan Limits Matter for Homebuyers

Conforming loan limits affect homebuyers by setting the maximum amount you can borrow with a . Staying within these limits often means access to lower interest rates, smaller down payments, and more flexible qualification standards than a jumbo loan.

Because conforming loans are considered less risky, lenders are typically able to offer better terms, helping make homeownership more affordable for a wider range of buyers.

What Are the Conforming Loan Limits for 2025?

Conforming loan limits vary based on the number of housing units on a property. Here’s what they look like for 2025:

• $806,500 for one-unit properties
• $1,032,650 for two-unit properties
• $1,248,150 for three-unit properties
• $1,551,250 for four-unit properties

Keep in mind that limits can vary based on county. They may be higher in some counties to accommodate their home prices, but they are rarely lower. Typically, exceptions are made for areas where home prices are much steeper, like New York or Los Angeles. The loan limits for these areas are up to 150% of the baseline amounts.

What Are the Conforming Loan Limits for 2026?

Here’s what conforming loan limits will be starting Jan. 1, 2026 in the continental U.S. plus Alaska and Hawaii:

• $832,750 for one-unit properties; $1,249,125 (AK/HI)
• $1,066,250 for two-unit properties; $1,599,375 (AK/HI)
• $1,288,800 for three-unit properties; $1,933,200 (AK/HI)
• $1,601,750 for four-unit properties; $2,402,625 (AK/HI)

Exceeding Loan Limits: Key Considerations

It’s important to understand the financial impact of exceeding loan limits. Non-conforming loans often come with higher interest rates, which can increase your monthly payments and total borrowing costs over the life of the loan.

When your loan exceeds the CLL, you’ll need to apply for a non-conforming loan—commonly called a jumbo loan—which doesn’t follow standard lending guidelines. Along with higher costs, these loans typically have stricter qualification requirements—a higher credit score, lower debt-to-income ratio, and more money for a down payment.

Buying a home is a significant investment, and it’s important to ensure that your mortgage aligns with your budget and goals. Talk to your lender about your options and what to expect during the process.

Final Thoughts: Conforming Mortgage Limits

If you’re in the market for a new home, conforming loan limits, which change ever year, can play a big role in your mortgage options. While properties in some counties might have different limits, these limits are fairly standard throughout the country. Ready to get started? Get an estimate of what you could qualify for by prequalifying with Freedom Mortgage today.

By Victoria Araj; Published on December 8th, 2025

Victoria Araj is the Senior Director, Managing Editor at Freedom Mortgage. She holds a bachelor’s degree in journalism with an emphasis in political science from Michigan State University, and a master’s degree in public administration from the University of Michigan.