conforming loans  · Conforming Loan. By Investopedia Staff. A conforming loan is a mortgage that is equal to or less than the dollar amount established by the conforming loan limit set by The Federal Housing Finance Agency (FHFA) and meets the funding criteria of Freddie Mac and Fannie Mae.

Loans designed to be sold to Fannie Mae or Freddie Mac must follow their rules, making them conforming loans. If you borrow less than roughly $417,000, your.

Determining whether a mortgage is a conforming or jumbo loan depends on the type of loan (FHA or conventional), the area's conforming loan.