The Federal Housing Finance Agency (FHFA) has announced the 2026 conforming loan limits, reflecting ongoing increases in U.S. home prices. The baseline limit for one-unit properties jumps to $832,750, up $26,250 (or 3.26%) from the 2025 level of $806,500. In high-cost areas, the ceiling reaches $1,249,125 (150% of the baseline). These changes take effect in 2026 and apply to conventional mortgages backed by Fannie Mae and Freddie Mac.
This annual adjustment is based on the FHFA House Price Index, which showed a 3.26% rise in average home prices between the third quarters of 2024 and 2025 (nominal, seasonally adjusted, expanded-data). For special areas like Alaska, Hawaii, Guam, and the U.S. Virgin Islands, the baseline is set at $1,249,125, with a ceiling up to $1,873,675 for one-unit properties.
What are Conforming Loan Limits?
Conforming loan limits define the maximum amount you can borrow for a conventional mortgage while still qualifying for purchase by Fannie Mae or Freddie Mac—the government-sponsored enterprises that buy and securitize most U.S. home loans. Loans at or below these limits are “conforming” and generally offer:
- Lower interest rates
- More flexible qualification standards (e.g., no minimum credit score, down payments as low as 3%)
- Easier approval and broader lender availability
Loans exceeding the limits are classified as jumbo loans, which often require:
- Higher credit scores (typically 700+)
- Larger down payments (10% or more)
- Stricter debt-to-income ratios
- Potentially higher rates and fees
These higher thresholds make jumbo financing more challenging, so staying within conforming limits can save buyers thousands over the life of the loan.
What This Means For You
Rising conforming limits boost purchasing power, especially in a market where median home prices continue climbing. Key benefits include:
- Afford more home without jumping into jumbo territory — A higher baseline means you can finance more expensive properties with conventional terms in standard areas.
- Better rates and terms — Staying conforming often means lower interest rates, reduced mortgage insurance requirements, and easier qualification compared to jumbo options.
- Opportunities in high-cost markets — Buyers in pricey regions (e.g., coastal cities) gain more room before needing jumbo financing.
- Refinancing potential — Homeowners with existing loans may find it easier to refinance into better terms if their balance fits within the new limits.
Next Steps
Higher limits don’t eliminate affordability challenges, but they make conventional financing more accessible for a wider range of homes. Whether you’re in North Carolina, or elsewhere, these updates could open doors to your next property. Contact us today to get pre-approved and for our team to run personalized scenarios and lock in the best options for your situation!
