What's the definition of a conforming loan?

A conforming loan is any type of home loan that meets the mortgage limits set by the Federal Housing Finance Agency (FHFA)—an independent government agency. These limits are based on property size and location and change annually with home prices. Conforming loans also require you to meet Fannie Mae and Freddie Mac lending guidelines. Home loans that fall outside the set limits (non-conforming) are called jumbo loans and tend to come with a few extra hurdles.