Conforming Loan Limits Increase: What This Means for Home Buyers

(12/2/24)  There’s good news for home buyers who plan to finance their purchase with a mortgage. The Federal Housing Finance Agency announced Nov. 26 that conforming loan limits for mortgages purchased on the secondary market by Fannie Mae and Freddie Mac will increase in 2025. For single-family homes in most of the United States, the GSEs will now purchase mortgages up to $806,500, an increase of $39,950 (or 5.2%) from 2024.

That means that someone purchasing a home in South Florida, for example, will be able to borrow up to $806,500 without needing a jumbo mortgage, which is a loan that exceeds that limit. So, if you’re purchasing a home for $1 million, and you plan to put 20% down, you no longer need a jumbo mortgage to finance the remaining $800,000. Last year, you did.

Why does this matter?

“It is somewhat easier to qualify for a conforming loan than a jumbo loan,” said Steve Chaney, a loan originator with Let's Talk Mortgages in Delray Beach. “The credit score requirements, as well as the qualifying ratios, tend to be more stringent for jumbo loans.”

Although the limit for conforming loans has been raised to $806,500 in most of the country, it’s even higher in certain metropolitan areas that have pricey real estate markets. For example, the limit in 2025 is $1,209,750 in San Francisco and Manhattan. And, while it’s $806,500 in Broward, Miami-Dade and Palm Beach Counties, it’s higher in Monroe County, home to the Florida Keys, where the limit is $967,150 before a home buyer needs a jumbo loan.