Conventional loans are secured by government sponsored entities or GSEs such as Fannie Mae and Freddie Mac. Conventional loans can be made to purchase or refinance homes with first and second mortgages on single family to four family homes. The current conventional loan limits can be found in the following table:
|
|
Maximum Original Principal Balance for 2010
|
|
Units
|
Contiguous States, District of Columbia, and Puerto Rico
|
Alaska, Guam, Hawaii, and the U.S. Virgin Islands
|
|
|
General
|
High-Cost*
|
General
|
High-Cost*
|
|
1
|
$417,000
|
$729,750
|
$625,500
|
$938,250
|
|
2
|
$533,850
|
$934,200
|
$800,775
|
$1,201,150
|
|
3
|
$645,300
|
$1,129,250
|
$967,950
|
$1,451,925
|
|
4
|
$801,950
|
$1,403,400
|
$1,202,925
|
$1,804,375
|
* High-cost area loan limits vary by geographic area; values in table are maximum amounts permitted across all high-cost areas.
Loans which are larger than the limits set by Fannie Mae and Freddie Mac are called jumbo loans. Because jumbo loans are not funded by these government sponsored entities, they usually carry a higher interest rate and some additional underwriting requirements.