Fannie Mae and Freddie Mac are restricted by law to purchasing single-family mortgages with origination balances below a specific amount, known as the “conforming loan limit.” Loans above this limit are known as jumbo loans.

The national conforming loan limit for mortgages that finance single-family one-unit properties increased from $33,000 in the early 1970s to $417,000 for 2006-2008. In 2008, legislation was passed that temporarily increased the one-unit limit to up to $729,750 in certain high-cost areas in the continental United States. That legislation, the Economic Stimulus Act of 2008, applied to loans originated between July 1, 2007 and December 31, 2008.

The 2009 national loan limit, set under terms set forth in the Housing and Economic Recovery Act of 2008, will continue to be $417,000 for one-unit properties, but can be up to $625,500 in high-cost areas. Loan limits for two-, three- and four-unit properties are correspondingly higher than the one-unit limits.

The limits are 50 percent higher for four statutorily-designated high cost areas: Alaska,  Hawaii, Guam, and the U.S. Virgin Islands.