A jumbo loan is a type of mortgage used to finance homes that exceed the conforming loan limits set by Fannie Mae and Freddie Mac — the two government-sponsored entities that buy most U.S. home loans.

Because the loan amount is higher, jumbo loans aren’t backed by these agencies, meaning lenders take on more risk. As a result, jumbo loans typically have:

• Stricter credit requirements (usually a credit score of 700 or higher)
• Larger down payment requirements (often 10–20% minimum)
• Lower debt-to-income ratios
• Stronger income and asset documentation

For 2025, the conforming loan limit in most areas is $766,550, though in high-cost areas (like much of California), it can go up to $1,149,825. Any loan above those limits is considered jumbo.