As of 2023, what is the maximum loan amount for a conforming loan in most areas?

The maximum loan amount for a conforming loan in most areas as of 2023 is $726,200. This figure is defined by the Federal Housing Finance Agency (FHFA) and is subject to adjustment based on annual changes in home prices. Conforming loans are those that meet the underwriting criteria set by Fannie Mae and Freddie Mac, two government-sponsored enterprises that purchase and guarantee mortgages.

The specific limit of $726,200 is important because it represents the threshold above which a loan is considered non-conforming or a jumbo loan, which typically has different underwriting requirements and interest rates. The conforming loan limit can vary in high-cost areas where home prices are significantly higher, but for the majority of U.S. regions, the limit is set at this amount. Understanding this limit is essential for mortgage loan officers as it impacts borrower eligibility, loan product offerings, and overall mortgage market dynamics.