A jumbo or non-conforming loan is a loan made for an amount exceeding conforming loan limits, often for a higher interest rate, and must be sold to alternative, secondary markets (i.e., markets other than Fannie Mae or Freddie Mac) or kept in the lender's portfolio. In other words, if the current maximum loan amount considered to be conforming for resale in the secondary market is no higher than the area's conforming loan limit, then any residential loan more than that amount would be a jumbo loan and would be ineligible for resale to Fannie Mae or Freddie Mac.
The maximum conforming loan limit for Contiguous States, District of Columbia, and Puerto Rico for one-unit properties is $510,400. For Alaska, Guam, Hawaii, and the U.S. Virgin Islands, the maximum conforming loan limit is $765,600. Areas that are classified as High-Cost Areas also have a maximum conforming loan limit of $765,600. Properties that have more than one unit also have higher maximum conforming loan limits.
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