Conforming Loan Limit: What It Is and What a Jumbo Loan Means

Published by the Modern Lending Solutions editorial team. Last reviewed: October 30, 2026.

Short answer: the conforming loan limit is the largest original loan amount that the two government-sponsored enterprises may buy. For 2026, the Federal Housing Finance Agency (FHFA) set the baseline at $832,750 for a one-unit home, with higher limits for two to four units and in high-cost areas, up to a ceiling of $1,249,125 for one unit. A loan above the limit for its area is called a jumbo loan. The limit also sets the floor and ceiling for FHA loan limits. This page covers federal law only. It is general information, not legal or financial advice.

What the law says

The charters of the two government-sponsored enterprises require each to set limits on the maximum original principal obligation of the conventional mortgages it buys (12 U.S.C. 1717(b)(2), LII, and 12 U.S.C. 1454(a)(2), LII, read October 30, 2026). The statute set the limits at $417,000 for one unit, $533,850 for two, $645,300 for three and $801,950 for four, adjusted each January 1 by the percentage increase in the house price index the FHFA Director maintains. If the index goes down, no adjustment is made, and later increases must first make up the earlier declines. In an area where 115 percent of the median house price for a home of that size is above the baseline, the limit rises to the lesser of that amount or 150 percent of the baseline. A separate clause lets the limits be up to 50 percent higher in a few areas the statute names.

The 2026 figures

FHFA announced the 2026 values on November 25, 2025: the one-unit baseline rose by $26,250 to $832,750, because its expanded-data house price index rose 3.26 percent between the third quarters of 2024 and 2025 (FHFA, read October 30, 2026). Its addendum gives the two- to four-unit baselines (FHFA addendum). The ceilings below are 150 percent of each baseline; FHFA confirms the one-unit figure of $1,249,125.

Units	2026 baseline	High-cost ceiling
One	$832,750	$832,750 × 150% = $1,249,125
Two	$1,066,250	$1,066,250 × 150% = $1,599,375
Three	$1,288,800	$1,288,800 × 150% = $1,933,200
Four	$1,601,750	$1,601,750 × 150% = $2,402,625

The few areas the statute names have higher limits; FHFA lists them. FHFA says it updates the limits at the end of each November and they take effect on January 1, so the 2027 values may be out after this page was read; check FHFA’s site (FHFA FAQs, updated November 2025). FHFA also says it rounds baseline values down to the nearest $50 and high-cost values down to the nearest $25, and that it does not lower an area’s limit when its median home value falls.

High-cost areas

FHFA groups counties into metropolitan and micropolitan statistical areas, takes the median home value of the highest-cost county in the area from HUD’s figures, and gives every county in the area the same limit (FHFA FAQs, questions 7 and 14). FHFA says over 95 percent of counties have the baseline limit. This example is only for the math: if an area’s median were $800,000, 115 percent of it is $920,000, which is above the $832,750 baseline and below the $1,249,125 ceiling, so the one-unit limit would be $920,000. To find the real limit for an address, use FHFA’s lists and map (FHFA) or HUD’s lookup (HUD) with Limit Type set to the option for the two government-sponsored enterprises, as the CFPB describes (CFPB, last reviewed January 12, 2024; its dollar figures are from an earlier year, so this page may be out of date).

What a jumbo loan means

FHFA says mortgages above the limit are known as jumbo loans (FHFA FAQs, question 1). The two government-sponsored enterprises cannot buy them, and the lender sets the terms; ask who will hold and service the loan. The CFPB says knowing the limit helps you know whether a home might need a higher down payment or a jumbo loan. Questions to ask: what down payment, reserves and credit score does the jumbo loan need, and how do its rate and fees compare with a conforming loan for a smaller amount?

Federal rules treat the two sizes differently in one place. A first-lien loan on your principal dwelling is a higher-priced mortgage loan if its APR is 1.5 or more percentage points above the average prime offer rate when the amount is at or under the limit of one of the two government-sponsored enterprises, 2.5 or more points when the amount is above that limit, and 3.5 or more points for a second lien (12 CFR 1026.35(a)(1), eCFR, text up to date as of October 28, 2026). This example is only for the math: with an average prime offer rate of 6.25%, those thresholds would be APRs of 7.75%, 8.75% and 9.75%. A first-lien higher-priced loan must have an escrow account for taxes and insurance, which you may ask to cancel no earlier than five years after closing, among other conditions (1026.35(b)(1) and (b)(3)); see the higher-priced mortgage escrow requirement. The ability-to-repay rule applies at any loan size; see the mortgage ability-to-repay rule.

How it feeds FHA limits

FHA loan limits are not capped at the conforming baseline, but they are set from it: the FHA floor is 65 percent and the FHA ceiling is 150 percent of the national conforming limit (12 U.S.C. 1709(b)(2), LII; FHFA FAQs, question 22). See FHA loan limits for the 2026 FHA figures. FHFA also says VA home loan limits stopped following the conforming limit on January 1, 2020 (FHFA FAQs, question 19).

Example: a price above the limit

This example is only for the math, with an example price in an area at the $832,750 one-unit baseline, not terms from any lender. With 10% down on a $1,000,000 home, the loan would be $900,000, which is $67,250 over the limit.

Option	Down payment	Loan amounts
Jumbo loan	$100,000 (10%)	$900,000 first lien, above the limit
Larger down payment: $1,000,000 − $832,750	$167,250 (16.7%)	$832,750 first lien, at the limit
First lien at the limit plus a second lien	$100,000 (10%)	$832,750 + $67,250 = $900,000

Each option has its own rate, fees and payment, so ask lenders for a Loan Estimate for each. A second lien adds a second payment and, if you fall behind, a second creditor with a claim on the home; see piggyback second mortgages.

Questions to ask the lender

What is the conforming loan limit for this address and number of units, and from which year’s list?
If my loan would be above the limit, what would a jumbo loan cost compared with a larger down payment or a second lien?
If my rate is not locked by year end, would a new limit on January 1 change my options?
Is the loan a higher-priced mortgage loan, and will it need an escrow account?

Checklist

Look up the limit for the exact county and number of units on FHFA’s or HUD’s site.
Compare your planned loan amount, not the price, with the limit.
Get Loan Estimates for each option and compare total costs.
Check the date on any limit you read; new values take effect each January 1.

To talk with a housing counselor, use the CFPB housing counselor search. You can submit a complaint at consumerfinance.gov/complaint.

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Sources

Disclosure: Modern Lending Solutions is not a lender, loan broker or agent for any lender or loan broker, and does not make credit decisions. Any compensation we receive is paid by participating lenders, only for advertising services. This guide is general information, not financial or legal advice.

The Conforming Loan Limit and Jumbo Loans