From 2024 to 2025: Tracking Changes in California Conforming Loan Limit

For homebuyers in California, understanding conforming loan limits is essential to making smart mortgage decisions. These limits determine how much you can borrow while qualifying for competitive rates and access to government-backed financing. As housing prices rise, the shift from conforming loan limit 2024 to conforming loan limit 2025 impacts both buyers and lenders.

This guide will explain what is a conforming loan limit, how limits have changed in California, and what homebuyers need to know to navigate the market in 2025.

What Is a Conforming Loan Limit

A conforming loan limit is the maximum mortgage amount that lenders can sell to government sponsored enterprises such as Fannie Mae and Freddie Mac. Loans that fall under this limit are called conforming loans and typically offer lower interest rates, easier approval, and smaller down payment requirements.

Loans that exceed the maximum conforming loan limit are considered non-conforming or jumbo loans and usually require higher credit scores and larger down payments.

Knowing what is the conforming loan limit for 2025 helps buyers in California plan their financing and avoid surprises when shopping for a home.

Conforming Loan Limit 2024 and 2025 Overview

The conforming loan limit 2024 reflected rising home prices across California but varied by county. For most areas, the baseline limit was around $766,550, with high-cost counties reaching up to $1,149,825.

For 2025, the conforming loan limit 2025 shows some adjustments:

• National baseline: $750,000
  
  
• High-cost California counties: Up to $1,125,000
  
  

This adjustment ensures that more California buyers can qualify for competitive financing without needing jumbo loans, making it easier to purchase mid-range and higher-priced homes.

How Conforming Loan Limits Are Determined

The Federal Housing Finance Agency reviews housing market data annually to adjust loan limits. Changes are based on the House Price Index, which tracks increases in home values nationwide.

For example, a 5% increase in median home prices results in a similar increase in the conforming loan limits for the following year. These updates ensure that mortgage conforming loan limits reflect current market conditions and remain aligned with home prices in California.

Why Changes in Limits Matter

Shifts in the conforming loan limit from 2024 to 2025 have practical implications for homebuyers:

• Loan Eligibility: More buyers can qualify for government-backed loans without entering jumbo loan territory.
  
  
• Interest Rates: Conforming loans typically have lower rates than non-conforming loans.
  
  
• Down Payments: Conforming loans often allow smaller down payments, helping buyers with limited savings.
  
  
• Refinancing Options: Higher limits provide flexibility for future refinancing without exceeding government-backed thresholds.
  
  

These changes are particularly important for buyers in California’s high-cost counties such as Los Angeles, San Francisco, and Orange County.

Comparing 2024 and 2025 Conforming Loan Limits

Even though high-cost counties see a small reduction, most California buyers still benefit from conforming financing, keeping monthly payments lower and approval processes simpler.

The Maximum Conforming Loan Limit

The maximum conforming loan limit refers to the highest loan amount that qualifies for purchase by Fannie Mae and Freddie Mac. For 2025, the maximum in high-cost California counties is $1,125,000. Borrowers above this threshold will need to consider jumbo loans, which often come with higher rates and stricter qualification criteria.

Understanding the mortgage conforming loan limit allows buyers to target properties within their financing capacity and avoid unnecessary costs.

How Merchants Home Lending Can Help

At Merchants Home Lending, we assist California homebuyers in understanding and leveraging conforming loan limits. Our team provides:

• Personalized mortgage guidance based on county-specific limits
  
  
• Pre-approval and loan comparison to ensure optimal rates
  
  
• Assistance with refinancing or upgrading from FHA to conventional conforming loans
  
  
• Support throughout the entire homebuying process
  
  

By staying informed about changes in limits, buyers can make smarter decisions, secure better rates, and confidently purchase their California home.

FAQs About Conforming Loan Limits

1. What is the conforming loan limit for 2025?

In California, the 2025 conforming loan limit is $750,000 for most areas, with high-cost counties up to $1,125,000.

2. What is the maximum for a conforming loan?

The maximum conforming loan limit in high-cost California counties for 2025 is $1,125,000.

3. What are conforming and non-conforming loans?

Conforming loans meet Fannie Mae and Freddie Mac guidelines, while non-conforming or jumbo loans exceed these limits and require stricter approval.

4. What is meant by non-conforming?

A non-conforming loan is any mortgage that exceeds the maximum conforming loan limit or does not meet the criteria set by Fannie Mae and Freddie Mac.

Final Thoughts

From 2024 to 2025, changes in conforming loan limits in California reflect ongoing home price trends and provide opportunities for more buyers to access affordable, government-backed financing.

Whether you are purchasing your first home or upgrading to a larger property, understanding the conforming loan limit and working with a trusted lender like Merchants Home Lending ensures a smooth and financially smart homebuying experience.