Why are there loan limits on standard mortgages? It all comes down to Fannie Mae and Freddie Mac. These agencies were established to help low-to-moderate income buyers purchase homes. To make sure the agency’s funds were being used for that purpose—not to help wealthy buyers—they established loan limits based on median home prices.
In most areas, any mortgage worth more than $484,350 counts as a jumbo loan. The limit varies based on county though, and some high-cost areas like New York City or Hawaii have a higher limit of $726,525.
