Conforming

A conforming loan conforms to the guidelines set by Fannie Mae and Freddie Mac. The main guideline is the maximum loan amount. This amount can vary depending on the home’s location—for example, a house in a high-income area can be eligible for a larger loan than one in a general income area. Other qualification guidelines are concerned with the borrower’s debt-to-income ratio, loan-to-value ratio and credit history.