Conforming and High-Balance Loan Limits

Updated 2026-05-17

Loan limits define the maximum amount for various types of mortgage loans, impacting their eligibility for purchase or guarantee by government-sponsored enterprises (GSEs) and federal agencies. These limits are established annually and vary based on the loan program, property type, and geographic location.

Conforming Loan Limits

Conforming loan limits represent the maximum loan amount that Government Sponsored Enterprise (GSE) and Government Sponsored Enterprise (GSE) are permitted to purchase or securitize/guarantee. These limits are crucial because they define what constitutes a "conforming loan" for Conventional Loans in the Other Loan Participants and Key Third Parties in the Mortgage Ecosystem. Loans that conform to these limits are eligible for purchase by Fannie Mae and Freddie Mac, which helps maintain liquidity in the secondary mortgage market.

Loans that exceed these limits are generally referred to as Jumbo Loans.

Determination and Adjustment

Conforming loan limits are adjusted annually by the Federal Housing Finance Agency (FHFA) (FHFA), based on a formula established by the Federal Housing Finance Agency (FHFA) (HERA). Specifically, the FHFA determines the baseline conforming loan limit each year based on the October to October percentage increase or decrease in average U.S. housing prices.

The limits also vary based on the number of units in the dwelling (e.g., one-unit, two-unit, three-unit, or four-unit properties).

Note: Conforming loan limits are dynamic and are typically announced by the FHFA in late November or early December each year, becoming effective the following January 1st. Mortgage Loan Originators (MLOs) must consult the latest FHFA announcements for current limits.

Types of Conforming Loan Limits

1. Baseline Loan Limits (General Loan Limits): These are the standard limits that apply to most areas across the United States.
2. High-Cost Area Loan Limits: In areas with higher home values, the FHFA may establish higher loan limits, known as "high-cost area" limits, which can be up to 150% of the baseline limit. These higher limits apply in designated high-cost areas.

Note that Alaska, Guam, Hawaii, Puerto Rico, and the U.S. Virgin Islands do not have separate high-cost areas; their baseline limits are already set at a higher level to reflect their elevated housing costs.

Example Conforming Loan Limits

2025 Conforming Loan Limits

As confirmed by Fannie Mae Lender Letter LL-2024-03, the 2025 conforming loan limits are as follows:

Baseline Loan Limits (2025)

Source: LL-2024-03 Loan Limits 2025.pdf

High-Cost Area Loan Limits Ceiling (2025)

Source: LL-2024-03 Loan Limits 2025.pdf

Example: Arizona Conforming Loan Limits (2026)

As an example, the conforming loan limits for Arizona in 2026 are:

• One Family: $832,750
• Two Family: $1,066,250
• Three Family: $1,288,800
• Four Family: $1,601,750

Effective Date and System Implementation

The 2025 limits are effective for whole loans delivered, and mortgage loans delivered into Other Loan Participants and Key Third Parties in the Mortgage Ecosystem with pool issue dates, on or after January 1, 2025. Source: LL-2024-03 Loan Limits 2025.pdf

Desktop Underwriter (DU) will apply the 2025 loan limits to loan casefiles submitted or resubmitted on or after the weekend of December 7, 2024. Loans previously deemed "Ineligible" solely due to exceeding the 2024 loan limit may be delivered after January 1, 2025, if they comply with the 2025 limits, without requiring resubmission to DU. Source: LL-2024-03 Loan Limits 2025.pdf

High-Balance Loans

High-balance loans are mortgage loans that exceed the standard Conforming and High-Balance Loan Limits for a given area but remain within the higher limits established for High Cost Area Loan Limits. These loans are eligible for purchase by Government Sponsored Enterprise (GSE) and Government Sponsored Enterprise (GSE) in designated high-cost areas.

Fannie Mae Requirements for High-Balance Loans

For loans delivered to Fannie Mae, high-balance loans must comply with specific requirements outlined in their Selling Guide. A key requirement for identifying these loans at delivery is the use of Government Sponsored Enterprise (GSE). Source: LL-2024-03 Loan Limits 2025.pdf

Ginnie Mae High Balance Loans

In the context of Federal Housing Administration (FHA) programs, High Balance Loans refer to single-family forward mortgage loans whose original principal balance exceeds specific limits set by Ginnie Mae. These limits are influenced by the Conforming and High-Balance Loan Limits announced by the Federal Housing Finance Agency (FHFA) (FHFA) under the Federal Housing Finance Agency (FHFA) (HERA). These limits are periodically revised by the FHFA and subsequently adopted by Ginnie Mae.

The original principal balance of a Ginnie Mae High Balance Loan is calculated net of any upfront Mortgage Insurance Premium (MIP) or VA Funding Fee. The maximum loan amounts vary based on the number of units in the dwelling and the geographical location (e.g., contiguous 48 states vs. Alaska, Hawaii, Guam, and U.S. Virgin Islands).

Note: The specific dollar amounts for Ginnie Mae High Balance Loan limits are dynamic and subject to change by official Ginnie Mae announcements. MLOs must refer to the most current Ginnie Mae publications for up-to-date figures.

Example Ginnie Mae Loan Limits (Illustrative, subject to change)

• Effective January 1, 2026 (for pools/loan packages submitted on or after this date):

  • 1 Unit: $832,750 (Contiguous 48 States), $1,249,125 (Alaska, Hawaii, Guam, U.S. Virgin Islands)
  • 2 Units: $1,066,250 (Contiguous 48 States), $1,599,375 (Alaska, Hawaii, Guam, U.S. Virgin Islands)
  • 3 Units: $1,288,800 (Contiguous 48 States), $1,933,200 (Alaska, Hawaii, Guam, U.S. Virgin Islands)
  • 4 Units: $1,601,750 (Contiguous 48 States), $2,402,625 (Alaska, Hawaii, Guam, U.S. Virgin Islands) (Source: Ginnie Mae APM 25-06 High Balance Loans, December 8, 2025)

• Effective January 1, 2025 (for issuances on or after this date):

• Effective January 1, 2024 (for issuances on or after this date):
  • 1 Unit: $766,550 (Contiguous States, District of Columbia, Puerto Rico), $1,149,825 (Alaska, Guam, Hawaii, U.S. Virgin Islands)
  • 2 Units: $981,500 (Contiguous States, District of Columbia, Puerto Rico), $1,472,250 (Alaska, Guam, Hawaii, U.S. Virgin Islands)
  • 3 Units: $1,186,350 (Contiguous States, District of Columbia, Puerto Rico), $1,779,525 (Alaska, Guam, Hawaii, U.S. Virgin Islands)
  • 4 Units: $1,474,400 (Contiguous States, District of Columbia, Puerto Rico), $2,211,600 (Alaska, Guam, Hawaii, U.S. Virgin Islands) (Source: Ginnie Mae MBS Guide Chapter 09)

Eligibility for Ginnie Mae Mortgage-Backed Securities (MBS)

High Balance Loans are eligible for Ginnie Mae MBS but are subject to specific restrictions detailed in the Ginnie Mae Mortgage-Backed Securities Guide 5500.3, Rev-1 ("MBS Guide"). MLOs must be aware of these limits and restrictions, especially the effective date of new limits, as they impact loan eligibility for Ginnie Mae securitization.

Key Requirements and Pooling Restrictions

• 10% Limit: For certain Ginnie Mae I MBS Program ("X SF") and Ginnie Mae II MBS Program ("M SF") pool types, the aggregate unpaid principal balance of High Balance Loans at the issue date cannot exceed 10% of the original principal balance of the entire pool or loan package. (Source: Ginnie Mae MBS Guide Chapter 09, Chapter 24)
• No Limit: For certain other pool types, including Ginnie Mae I "X BD" and "X SN," and Ginnie Mae II "M JM," "M FS," "All ARMS," "C SF," "C RG," "C ET," and "C BD" pool types, there is no limit on the amount of High Balance Loans that can be pooled. (Source: Ginnie Mae MBS Guide Chapter 09, Chapter 24)
• Combination with Buydown Loans: In multiple Issuer pools or loan packages (M SF), a loan can be both a Federal Housing Administration (FHA) and a High Balance Loan. If so, it counts against the 10% limit for each requirement. However, M SF pools and loan packages generally cannot contain both High Balance Loans and buydown loans. (Source: Ginnie Mae MBS Guide Chapter 24)
• Number of Units: A mortgage loan for a two-to-four-unit dwelling may be a High Balance Loan, provided all pooling requirements are met by the Issuer. (Source: Ginnie Mae MBS Guide Chapter 24)
• MERS Registration: Upon issuance of a Ginnie Mae MBS, the Issuer must register Federal Housing Administration (FHA) as the "investor" and enter the pool or loan package number on the MERS system. (Source: Ginnie Mae MBS Guide Chapter 09)
• Escrow Accounts: Funds for escrow accounts must be deposited into the appropriate servicer's escrow custodial account established for the pool or loan package. (Source: Ginnie Mae MBS Guide Chapter 09)

Jumbo Loans

Jumbo Loans are a type of Conventional Loans that exceed the conforming loan limits set by the Federal Housing Finance Agency (FHFA) for Fannie Mae and Freddie Mac. These loans are used to finance luxury homes or properties in high-cost areas where the purchase price is significantly higher than the average.

Key characteristics of jumbo loans include:

• Higher Loan Amounts: The defining feature is that the loan amount surpasses the conforming loan limits, which are adjusted annually.
• Stricter Underwriting: Due to the larger loan amounts and increased risk for lenders, jumbo loans typically have more stringent underwriting requirements. This often includes higher credit score requirements, lower debt-to-income ratios, and larger reserve requirements (liquid assets after closing).
• Larger Down Payments: While not always required, a larger down payment (e.g., 10-20% or more) is common for jumbo loans.
• Potentially Higher Interest Rates: Interest rates for jumbo loans can sometimes be slightly higher than conforming loans, though this can vary based on market conditions and the borrower's credit profile.
• Multiple Appraisals: Lenders may require two independent appraisals for jumbo loans to ensure the property's value supports the large loan amount.

Jumbo loans are a specialized product for borrowers seeking to finance high-value properties that fall outside the standard conventional loan market.

VA Loan Limits

Historically, VA loan limits represented the maximum amount the VA would guarantee without a down payment. However, the policy regarding VA loan limits has changed.

As of 2026, the VA no longer sets loan limits for Borrower (Consumer) with their full VA Loan Entitlement, Certificate of Eligibility (COE), and Loan Guaranty Certificate (LGC). This means that eligible borrowers with full entitlement can borrow as much as a lender is willing to provide, without a down payment.

For veterans with a partial entitlement, loan limits may still apply and are typically based on county loan limits. Borrowers can determine their entitlement and current loan limits through the VA's official resources.

• Citation: 38 U.S.C. § 3703, 38 CFR § 36.4303