A jumbo mortgage loan is a type of financing that exceeds the limits set by the Federal Housing Finance Agency (FHFA) for conventional conforming loans. In the United States, the maximum amount for a conforming loan in 2023 is $726,200 in most counties, as determined by the FHFA. Homes that exceed the local conforming loan limit require a jumbo loan. Jumbo loans are considered riskier for lenders because they are larger in size and cannot be guaranteed by Fannie Mae and Freddie Mac, meaning the lender is not protected from losses if a borrower defaults. Jumbo loans are typically available with either a fixed interest rate or an adjustable rate, and they come with a variety of terms. Jumbo lenders typically impose stricter underwriting guidelines than conforming-mortgages lenders do, and homeowners must undergo more rigorous credit requirements than those applying for a conventional loan. The interest rate charged on jumbo mortgage loans is generally higher than a loan that is conforming, due to the higher risk to the lender.