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A conforming loan limit caps the mortgage balance that Fannie Mae and Freddie Mac can generally acquire; it does not cap a home’s price. If your planned mortgage is above the applicable county limit, increasing your down payment reduces the amount borrowed and may bring the loan within the conforming range. For a 2026 one-unit home in a county using the national baseline, a $900,000 purchase would require at least $67,250 down to produce an $832,750 loan, before closing costs and other financing adjustments.
The limit is only one part of approval. You still must meet a lender’s credit, income, debt-to-income, reserve, appraisal and property requirements, and you should compare official Loan Estimates before choosing between a larger down payment, a less expensive home or a jumbo mortgage.
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What a conforming loan limit actually limits
The conforming limit applies to the principal mortgage balance, not to the purchase price. A $1 million home can have a conforming mortgage if the borrowed amount is at or below the applicable limit; a less expensive home can require a jumbo loan if the financing exceeds its county limit.
The Federal Housing Finance Agency (FHFA) sets limits each year. They determine the maximum loan amount that Fannie Mae and Freddie Mac can generally purchase, which is why loans above the limit are commonly called jumbo or non-conforming loans. FHFA describes the rule as restricting “the size of loan originations that the Enterprises can purchase (but not the price of homes).”
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2026 one-unit limits
| Location or category | 2026 limit | How to use it |
|---|---|---|
| National baseline, one-unit property | $832,750 | Applies in counties that do not have a higher limit. |
| High-cost ceiling in most states, one-unit property | $1,249,125 | Some high-cost counties have limits between the baseline and this ceiling. |
| Alaska, Hawaii, Guam and U.S. Virgin Islands | Higher statutory limits | Use the county and unit-specific FHFA table rather than the national figures. |
FHFA announced the 2026 baseline and ceiling in 2025 after measuring a 3.26% average increase in national home prices from the third quarter of 2024 to the third quarter of 2025. The 3.26% figure is rounded from the methodology’s 3.25735384%. Limits can change each calendar year, so a number from an older article or a prior loan application may not be current.
Unit count changes the limit
FHFA publishes separate columns for one-, two-, three- and four-unit properties. A duplex, triplex or fourplex therefore cannot be evaluated using the one-unit number automatically. Owner-occupied multi-unit properties may also have different underwriting requirements, even when the balance fits the published limit.
How to find the limit for your county
Use the current-year FHFA county-level conforming loan-limit table. A consumer FAQ from the Consumer Financial Protection Bureau (CFPB), last reviewed in January 2024, explains the lookup process but contains older dollar amounts; use it for the method, not for 2026 values.
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- Identify the property’s county. Use the county in which the home sits, not your mailing address, the lender’s office or a nearby city with a different limit.
- Select the calendar year. For a mortgage acquired in 2026, use FHFA’s 2026 table. A lender may lock a rate in one year and deliver the loan in another, so ask which acquisition year controls your file.
- Choose the unit column. Select one, two, three or four units based on the property, including a legal accessory unit where the lender classifies it as an additional dwelling.
- Record the exact limit. High-cost counties can have an amount between $832,750 and $1,249,125 for one-unit homes. Do not substitute the statewide ceiling for the county’s actual entry.
- Give the figure to your lender. Ask the lender to confirm that the county, units and loan-purpose rules match the agency guidelines being used for your application.
Calculate the down payment needed to fit the limit
For a simplified purchase calculation, subtract the down payment from the purchase price:
Planned loan = purchase price − down payment
If that result is higher than the applicable conforming limit, calculate the minimum principal reduction needed:
Minimum down payment for the limit = purchase price − applicable loan limit
This is a principal-only calculation. It excludes closing costs, prepaid taxes and insurance, discount points, financed guarantee or mortgage-insurance fees, seller credits and any other adjustment that changes the final loan amount.
Worked 2026 example
Assume a one-unit home costs $900,000 and the county’s applicable 2026 limit is the national baseline of $832,750. The minimum down payment to produce a loan at the limit is:
$900,000 − $832,750 = $67,250
A $67,250 down payment is 7.47% of the purchase price, leaving an $832,750 principal balance in this simplified example. A smaller down payment would create a balance above the assumed limit and would generally require a jumbo product or a different transaction structure. The actual minimum cash needed at closing will be higher because it must also cover transaction charges and required reserves.
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Leave room below the ceiling when appropriate
Borrowing exactly to the limit can leave no allowance for a lender’s calculation differences or a financed cost that increases principal. Ask for the projected final note amount, not just the contract-price calculation. A modest cushion below the limit can prevent an unexpected classification change, but it ties up more cash and is not a substitute for underwriting approval.
What a larger down payment changes
It reduces the loan balance and payment
Every additional dollar paid at closing reduces principal by a dollar in a simple purchase. A smaller balance generally produces a lower principal-and-interest payment and less interest over the life of the loan, although the exact payment depends on the rate, term, points and loan type. Compare the payment shown on each lender’s Loan Estimate rather than estimating from the limit alone.
It can reduce or eliminate mortgage insurance
For a conventional loan, the CFPB says borrowers who put down less than 20% will typically need mortgage insurance. Reaching 20% may remove the requirement for borrower-paid private mortgage insurance, subject to the loan’s rules, but getting below the conforming limit does not by itself eliminate mortgage insurance. A borrower with a 7.47% down payment in the $900,000 example could remain subject to it even though the balance fits the baseline limit.
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It consumes liquidity
Cash used for the down payment cannot also fund closing costs, moving expenses, repairs, emergency reserves or post-closing cash requirements. A lender may require documented reserves, especially for a high balance or a multi-unit property. Do not use every available dollar merely to avoid a jumbo classification; preserve the liquidity your budget and underwriting file require.
It may change total borrowing costs
A conforming loan can have different rates, fees, debt-to-income treatment and mortgage-insurance options from a jumbo loan, but no category is automatically cheaper for every borrower. Compare the annual percentage rate, points, lender fees, mortgage insurance, required reserves, prepayment terms and cash due at closing. CFPB guidance recommends obtaining official Loan Estimates before deciding.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Three ways to handle a loan above the county limit
| Strategy | Immediate effect | Advantages | Trade-offs and questions |
|---|---|---|---|
| Increase the down payment | Reduces the first-lien balance to the county limit or below. | May provide conforming pricing or underwriting, lowers payment and can reduce mortgage insurance as the down payment rises. | Requires more cash; verify reserves, closing costs and the source of funds. |
| Choose a lower purchase price | Reduces the amount needed without adding cash at closing. | Preserves liquidity and may keep the same down-payment percentage. | May mean a different neighborhood, property or features; the new county limit and unit count still apply. |
| Use a jumbo or other non-conforming loan | Allows a balance above the conforming limit. | Can support the desired purchase without as large a down payment. | Terms and features vary by lender; rates, fees, reserve requirements, credit standards and adjustable-rate options must be compared. |
A split structure such as a first mortgage plus a second lien may be offered in some markets, but its combined payment, fees and underwriting treatment must be evaluated as a complete package. Do not assume that dividing the borrowing automatically makes it conforming.
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Approval requirements do not disappear when the balance fits
Being at or below the FHFA amount only addresses the size threshold for agency acquisition. The lender still evaluates verified income and employment, debt-to-income ratio, credit history, assets and reserves, occupancy, property condition, title and appraisal. A loan can be within the county limit and still be declined or require different terms.
The appraisal also matters. If an appraisal is below the contract price, your usable loan-to-value ratio changes and you may need additional cash even when the original purchase-price calculation was under the limit. Ask whether the lender uses the purchase price, appraised value or the lower of the two in the relevant underwriting calculation.
Common mistakes and how to avoid them
- Using a national number for every county: Check the exact county and unit column; high-cost areas and statutory jurisdictions differ.
- Confusing price with balance: A home can cost more than the limit and still have conforming financing when the down payment reduces the mortgage enough.
- Relying on an old table: FHFA updates limits annually. Confirm the year tied to your loan’s acquisition and delivery.
- Ignoring financed charges: Points, financed fees or other adjustments can increase the note amount above your simple purchase-price-minus-down-payment result.
- Spending all cash on the down payment: Budget separately for closing, prepaid items, repairs and lender-required reserves.
- Assuming conforming means guaranteed approval: Size eligibility is not a promise of approval, a particular rate or the absence of mortgage insurance.
- Comparing advertisements instead of Loan Estimates: Request the standardized forms from each lender and compare rate, APR, cash to close, monthly payment, mortgage insurance and five-year borrowing cost.
A practical decision checklist
- Pull the current FHFA limit for the property’s county, year and number of units.
- Calculate the projected principal after your planned down payment.
- If it exceeds the limit, calculate the additional principal reduction required and add closing costs and reserves to the cash target.
- Ask lenders for Loan Estimates for a conforming structure at the larger down payment and for a jumbo structure with the cash you prefer to retain.
- Compare payment, APR, points, mortgage insurance, lender fees, reserve rules, rate-adjustment terms and total cash to close.
- Confirm the appraisal, property type, occupancy and documentation requirements before making an offer that depends on a particular loan category.
The best choice is the one that keeps the complete monthly and cash-flow plan sustainable, not simply the one that places the balance below a published threshold.
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