Conventional, conforming, or jumbo: what the words mean and why your county matters

Conventional means not government-backed

The CFPB defines a conventional loan as one that is not insured or guaranteed by FHA, VA, or USDA. That is the whole definition; it says nothing about the rate, the down payment, or the lender. A conventional loan can be conforming or non-conforming, and it is the most common type of mortgage in Maryland.

Because there is no government insurance behind it, the lender relies on your credit, income, assets, and the down payment. Below 20 percent down you usually pay private mortgage insurance, which the down payment guide on this site explains.

Conforming means it fits Fannie Mae and Freddie Mac’s rules

Most conventional loans are sold to Fannie Mae or Freddie Mac after closing, which is why lenders write them to those companies’ standards. The CFPB describes a conforming loan as one that satisfies the terms and conditions set by Fannie Mae, Freddie Mac, and their regulator, the Federal Housing Finance Agency. The best-known condition is the maximum loan amount.

Conforming rules also cover the down payment, credit, debt-to-income ratio, property type, and documentation. Fannie Mae’s Selling Guide is the rulebook lenders follow, and its loan-limits page is the official source for the maximum amounts.

Why the limit differs by county in Maryland

The regulator sets a baseline limit for one-unit homes each year and a higher limit for designated high-cost areas. The CFPB notes that in 2024 the general limit was $766,550 and reached $1,149,825 in the most expensive counties of the continental United States; both numbers change every year, so check the current ones rather than relying on this page.

In Maryland, the counties in the Washington metropolitan area, including Montgomery, Prince George’s, Frederick, Calvert, and Charles, carry the high-cost limit, while the Baltimore-area counties and most of the rest of the state use the baseline. Two-, three-, and four-unit properties have their own higher limits. The CFPB explains how to look up the limit for your county, and your loan officer does it as part of the preapproval.

What changes when the loan is jumbo

Loans above the limit are allowed; the CFPB simply notes they are called jumbo mortgages and that they may cost more than a conforming loan. Because Fannie Mae and Freddie Mac will not buy them, each lender sets its own rules, and those often include a larger down payment, higher credit scores, more months of reserves, and sometimes a second appraisal.

In the high-cost Maryland counties the conforming limit already covers most homes, so many buyers who assume they need a jumbo loan do not. Run the number before you assume.

FHA limits are a separate list

FHA loans have their own county limits, also set each year, that the CFPB explains how to look up. They follow the same high-cost logic but are not the same numbers as the conforming limits. If you are comparing an FHA loan with a conventional one for the same Maryland house, you are checking two different limits.

The FHA guide on this site covers how that program works; this page is about the conventional side.

Ask before you shop

The limit affects the price range you can shop in with a conventional loan and a given down payment, so it belongs in the preapproval conversation, not at the offer stage. Ask your loan officer for the current limit in each county you are considering and for what happens to the terms if you cross it.

In Maryland, Paola answers that on the first call at New Priority Lending Corp. This page does not determine your loan amount, your eligibility, or the terms you would receive.

• What is the current conforming limit for this county and unit count?
• If I cross it, what is the jumbo down payment, credit, and reserve requirement?
• Would a slightly larger down payment keep the loan conforming?