Jumbo Loans

Each year Fannie Mae, Freddie Mac, and their regulator, the Federal Housing Finance Agency (FHFA), set a maximum amount for loans that they will buy from lenders. Mortgage loans are allowed to exceed these loan limits. Larger loans are called jumbo mortgages. The cost of obtaining a jumbo mortgage may be higher than the cost of obtaining a conforming mortgage.

Jumbo loans are typically held by the lender and are not insured by the government. This limits the number of lenders willing to lend money for jumbo loans and makes the qualification process very broad and handled on a case-by-case basis.