A conforming loan limit is the maximum dollar amount that a mortgage can be for it to be considered a conforming loan. Conforming loans are mortgages that meet certain criteria and are backed by Fannie Mae and Freddie Mac, the government-sponsored entities that buy conforming loans. The conforming loan limit is set every year by the Federal Housing Finance Agency (FHFA) and is adjusted to reflect changes in the average price of a home in the United States. The limit is designated by county and varies based on regional economic differences. For 2023, the conforming loan limit for one-unit properties is $726,200, an increase from $647,200 in 2022. However, the limit can be higher in some expensive housing markets, such as Alaska, Hawaii, Washington, D.C., and some counties, such as San Francisco. The increase in the conforming loan limit offers buyers more buying power, meaning they can spend more on a home. Conforming loans typically come with lower interest rates than other non-conforming loan types.