What is a conforming mortgage?

A conforming mortgage is a type of home loan that meets the guidelines set by government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac. These guidelines establish maximum loan amounts and credit standards for conforming loans, which are easier for lenders to sell to investors on the secondary mortgage market. Conforming loans typically have lower interest rates than non-conforming loans, such as jumbo loans, which exceed the GSEs' loan limits.