What Is a Conforming Loan?

Short answer

A conforming loan is a conventional mortgage that meets the size and underwriting rules set by Fannie Mae and Freddie Mac. For 2026 the baseline limit for a one-unit home is $832,750 in most of the country, including Miami-Dade and Broward, with higher limits for 2 to 4 units and in designated high-cost areas (FHFA, as of October 2026). Loans above the limit are jumbo loans.

Definition

Conforming means the loan can be sold to Fannie Mae or Freddie Mac because it fits their loan limit and their guidelines on credit, income, assets and property. Conforming loans usually carry the most competitive pricing among conventional loans.

Worked example

You are buying a $950,000 home in Miami Lakes. With 10% down ($95,000) the loan would be $855,000, which is above the $832,750 limit, so it would be a jumbo loan with jumbo guidelines. Put down $117,250 instead (12.3%) and the loan is exactly $832,750, conforming. Or split it: a conforming first mortgage of $760,000 (80% LTV) plus a second mortgage or HELOC of $95,000, with $95,000 down. The right structure depends on pricing that day; rates vary daily.

Conforming vs other loans

• Conforming: within the limit, Fannie or Freddie rules, best conventional pricing, PMI above 80% LTV.
• Jumbo: above the limit, lender's own rules, often larger reserves and down payment.
• FHA and VA: government programs with their own limits and insurance.
• Non-QM: does not follow agency rules on income documentation, for self-employed or investor borrowers.

Why the limit matters

Each November FHFA announces the next year's limit based on national home price changes. Staying just under it can save money on rate and on reserves. Since the limit is per loan, not per price, you can often bring a slightly larger down payment or use a second lien to stay conforming. See conventional loans.

In South Florida

Miami-Dade, Broward and Palm Beach are not FHFA high-cost counties, so the baseline limit applies even though prices in Coral Gables, Key Biscayne or Fort Lauderdale beach areas often exceed it. That pushes many South Florida buyers into jumbo territory or into creative structures like a conforming first plus a second lien. Conforming loans on condos also require the project to pass Fannie Mae or Freddie Mac condo review, which many older or litigation-heavy Miami buildings fail; those become non-warrantable.