How conforming loan limits are set

What a conforming loan limit means

A conforming loan limit is the highest loan amount for a mortgage that Fannie Mae or Freddie Mac can acquire. A mortgage above the limit for its county is called a jumbo loan.

The Federal Housing Finance Agency (FHFA) sets the limits each year under the Housing and Economic Recovery Act of 2008. The limits are based on the number of units in the home and where the home is located.

How FHFA updates the baseline

The baseline is the standard limit. For a one-unit home, the 2026 baseline is $832,750, up from $806,500 in 2025. FHFA calculates the increase using the change in its seasonally adjusted, expanded-data House Price Index from the third quarter of 2024 to the third quarter of 2025: 3.25735384 percent.

The 2026 baseline for a two-unit home is $1,066,250. For three units it is $1,288,800, and for four units it is $1,601,750. A two-to-four-unit home means one building with two, three, or four separate living units.

FHFA rounds baseline values down to the nearest $50. If national home prices fall, the baseline stays flat until earlier price declines have been made up. Limits do not go down: FHFA keeps a county’s limit at least at its prior value, a policy called “hold harmless.” The baseline was $417,000 from 2006 until 2017.

How high-cost limits work

A county may get a higher limit when 115 percent of its median home value is above the baseline. FHFA uses median home values estimated by the Federal Housing Administration (FHA), part of the Department of Housing and Urban Development (HUD). The limit is 115 percent of the median, but it cannot be higher than 150 percent of the baseline.

For one-unit homes in 2026, the highest possible limit is $1,249,125. The ceilings are $1,599,375 for two units, $1,933,200 for three units, and $2,402,625 for four units. FHFA calculates high-cost limits for multi-unit homes using fixed multipliers from HERA’s original values, with each limit capped at its own ceiling. High-cost values are rounded down to the nearest $25.

Most counties—over 95 percent—get the baseline. In a given year, roughly 100 to 200 counties qualify for a high-cost value. The 2026 file has 3,235 county rows, with 121 counties outside Alaska, Hawaii, Guam, and the U.S. Virgin Islands above the baseline.

How counties in metro areas share a limit

FHFA groups counties by core-based statistical areas, which include metro and micropolitan areas defined by the Office of Management and Budget. Every county in an area gets the value of that area’s highest-cost county.

In Santa Barbara County, California, the median home value was $819,000. Multiplying that by 115 percent gives $941,850, which became the county’s 2026 limit.

In the Seattle-Tacoma-Bellevue area, the highest county median was $925,000. At 115 percent, that is $1,063,750, and the same limit applies to all three counties in the area. In the Washington, DC metro area, 115 percent of the $1,198,000 median is above the ceiling, so every county gets the $1,249,125 ceiling.

In the Tallahassee, Florida area, the highest county median was $277,000. The counties in that area get the baseline.

Special areas and annual timing

Alaska, Hawaii, Guam, and the U.S. Virgin Islands have a baseline that is 50 percent higher by statute. Their 2026 one-unit baseline is $1,249,125. Two Hawaii counties, Maui and Kalawao, have a higher limit of $1,299,500.

FHFA updates conforming loan limits at the end of each November, and the new limits take effect on January 1. These figures come from FHFA’s Conforming Loan Limit Values FAQs, updated in November 2025, and its addendum on calculating 2026 limits under HERA.