Conforming and FHA Loan Limits Jump Over 5% for 2025

The Federal Housing Financing Agency (FHFA) recently announced new conforming loan limits for 2025 for residential mortgages to be acquired by Fannie Mae and Freddie Mac. These new limits are increasing to keep pace with the continued appreciation of home prices over the past year.

The new baseline loan limit for one-unit properties will be $806,500, a $39,950 increase over 2024.

In areas like Hawaii, Alaska, and locations in Virginia, where 115% of the local median home value is greater than the baseline conforming loan limit, the loan limit is adjusted higher.

In these high-cost areas, the new maximum loan limit will be $1,209,750 (from $1,149,825 in 2024), which is 150% of the baseline limit of $806,500.

FHFA 2025 Limits

Number of Units	Baseline Limits	High-Cost Area Limits
One	$806,500	$1,209,750
Two	$1,032,650	$1,548,975
Three	$1,248,150	$1,872,225
Four	$1,551,250	$2,326,875

Federal Housing Authority (FHA) Loan Limit
For FHA loans, the “floor” limit will be $524,225, a $25,968 increase over the 2024 baseline, while the “ceiling” limit will be $1,209,750. In Alaska and Hawaii, the “ceiling” limit will be $1,814,625.

FHA loans have lower down payment and credit score requirements than conventional loans and are popular for first-time buyers.

FHA 2025 Limits

Number of Units	Low-Cost Area “Floor”	High-Cost Area “Ceiling”	Alaska, Hawaii, Guam, and U.S. Virgin Islands “Ceiling”
One	$524,225	$1,209,750	$1,814,625
Two	$671,200	$1,548,975	$2,323,450
Three	$811,275	$1,872,225	$2,808,325
Four	$1,008,300	$2,326,875	$3,490,300

FHFA and FHA are required by federal law to adjust conforming loan limit values yearly to reflect changes in U.S. home prices. The conforming loan limit will rise by 5.2% in 2025 due to the FHFA House Price Index that determined the average U.S. home value increased by that amount between the third quarters of 2023 and 2024.

2025 conforming loan limits are available by clicking here.

2025 FHA conforming loan limits are available by clicking here.

Benefits of Higher Loan Limits
Home Buyers

Lower Monthly Payment and Overall Loan Costs

Purchasing a home with a conforming loan versus a higher-cost jumbo loan can lower your borrowing costs. Conforming loans generally have better interest rates, lower costs, and flexible down payment, credit, and qualification guidelines.

Increased Purchasing Power

Apply for a larger loan to buy a better home with a remodeled kitchen, extra bedroom, more space, or in a preferred location.

Homeowners

Tap into more equity with a cash-out refinance

Pay down debt, cover college tuition, or make home improvements.

Refinance a Jumbo Loan

If you have a jumbo loan with a balance near a new loan limit in your area, you may benefit by refinancing to a conforming loan.

Ready to Discuss Your Mortgage Options?
With higher loan limits for 2025, borrowers now have greater flexibility in both conventional and FHA programs. Whether you're purchasing a primary residence or expanding your investment portfolio, reach out today to discover how these changes can open new opportunities for you. Call 808-566-6611 or request a no-obligation consultation.