Conforming Loans

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Conforming loans are mortgage loans that meet the underwriting guidelines and loan limits set by Fannie Mae and Freddie Mac.

Because they “conform” to these standards, they can be sold to these government-sponsored enterprises (GSEs) in the secondary mortgage market — which typically results in lower interest rates and more flexible terms for borrowers.

Conforming loans must stay within annual loan limits set by the Federal Housing Finance Agency (FHFA).

For 2026 (most U.S. counties):

• $766,550 for a single-family home 
• Higher limits apply in designated high-cost areas (such as parts of California)
   

If a loan exceeds the limit, it becomes a jumbo loan (non-conforming).

Typical guidelines:

• Minimum credit score: ~620
• Lower debt-to-income (DTI) ratios preferred 
• Stable income and employment history
   

Higher credit scores generally receive better interest rates.

• As low as 3%–5% for qualified buyers
• 20% down avoids private mortgage insurance (PMI)
   

If the down payment is less than 20%, PMI is usually required — but it can be removed once sufficient equity is reached.

The home must:

• Meet appraisal standards
• Be suitable for residential occupancy 
• Not exceed certain condition guidelines
   

• Fixed-rate mortgages (15, 20, 30-year) 
• Adjustable-rate mortgages (ARMs) 
• First-time homebuyer programs
• Conventional refinance loans
   

Conforming loans are conventional loans that meet GSE standards. They are different from government-backed loans like:

• Federal Housing Administration (FHA loans) 
• Department of Veterans Affairs (VA loans) 
• United States Department of Agriculture (USDA loans)
   

• Generally lower interest rates than jumbo loans
• Widely available
• Flexible terms 
• Can be used for primary homes, second homes, and investment properties