The recently announced changes to conforming loan limits means that some 2 million homes will no longer require jumbo loans.
According to Zillow, for the majority of the country, the conforming loan requirement increased by $79,000—going from $647,200 in 2022 to a baseline of $726,200 in 2023.
The news may be welcome for buyers looking to purchase a home as jumbo loans often come with additional fees and more stringent qualification standards, making them less affordable for most buyers. Jumbo loans typically require a higher credit score compared to conforming loans. Jumbo loans also often require 20 percent down, although some call for even higher down payments. Some jumbo loans also require proof of larger cash reserves than conventional loans.
Zillow estimates that some 2 million homes will no longer need jumbo loans under the adjusted conforming loan limits.
In the most expensive parts of the county—like California—the conforming loan limit was raised to $1,089,300, topping the $1 million mark for the first time.