Fannie Mae and Freddie Mac aren’t your neighbors — they’re mortgage game changers. Here’s how to leverage their 2025 loan limit boost

Conforming loan limits are increasing

Each year, Fannie Mae and Freddie Mac set a baseline conforming loan limit, adjusting it for high-cost areas. For 2025, the baseline limit is rising from $766,550 to $806,500.

Limits for high-cost areas, including Alaska, Hawaii, Guam, and the U.S. Virgin Islands, are also increasing — from $1,149,825 to $1,209,750 in 2025.

Invest in real estate without the headache of being a landlord

Imagine owning a portfolio of thousands of well-managed single family rentals or a collection of cutting-edge industrial warehouses. You can now gain access to a $1B portfolio of income-producing real estate assets designed to deliver long-term growth from the comforts of your couch.

The best part? You don’t have to be a millionaire and can start investing in minutes.

Learn More

How higher conforming loan limits can benefit you in 2025

Conforming loans are typically cheaper and easier to qualify for than non-conforming loans. For instance, jumbo mortgages — loans that exceed Fannie and Freddie's conforming limits — often come with higher interest rates, stricter credit score requirements and larger down payments.

With a conforming loan, you might qualify with a credit score as low as 620 and a down payment as low as 5% (though anything less than 20% will require private mortgage insurance, so that’s something to consider). In contrast, a non-conforming lender might require a minimum credit score of 700 and a down payment of 10%, 20%, or even 30%.

The increase in conforming loan limits gives buyer more options, which is especially important given the way home prices have risen substantially in recent years.

During the third quarter of 2020, the median U.S. home sold for $327,900. By the third quarter of 2024, that number jumped to $420,400 — a 28% increase in just four years. Without higher conforming loan limits, more buyers would be forced to turn to pricier non-conforming mortgages.

Helping younger buyers access homeownership

Rising home prices and mortgage rates have made it harder for younger buyers to break into the housing market. In 2024, the National Association of REALTORS reported that the median age of homebuyers increased to 56, up from 49 the previous year. Similarly, the median age for first-time buyers increased from 35 to 38.

Higher conforming loan limits could ease these challenges, especially for younger buyers with smaller savings or less home equity. Being able to buy a home sooner can set them on a path toward greater financial stability and wealthy.

In fact, a report by the National Association of Home Builders confirmed that homeownership plays a key role in household wealth. It also found that households' primary residences were their single largest asset as of 2022, underscoring the role of homeownership in building wealth. By adjusting conforming loan limits are adjusting to today’s housing market conditions, Fannie Mae and Freddie Mac may help open the door to more people, including younger buyers, in 2025.