The Federal Housing Finance Agency (FHFA) has set the 2023 California Conforming loan limit at $726,200 and up to a $1,089,300 loan limit in “high-cost” counties like Orange County, Los Angeles County, Santa Clara County, and San Mateo County.
This is good news for homeowners and homebuyers throughout California. This allows some mortgage loans previously labeled “Jumbo” to be placed in the Conforming loan category. Conforming loans in California generally come with better mortgage rates and easier underwriting requirements.
What is a Conforming loan? A conforming loan is a home loan that “conforms” to the loan limits established by the Federal Housing Finance Agency and the underwriting guidelines of Fannie Mae and Freddie Mac.
2023 California Loan Limits By County
Here are the 2023 Conforming loan limits in California for all 58 counties. The Federal Housing Finance Agency (FHFA) annually updates its conforming loan limits. For comparison purposes, we also list the 2023 California FHA loan limits.
| County | 2023 California Conforming Loan Limit | 2023 California FHA Loan Limit |
| ALAMEDA | $1,089,300 | $1,089,300 |
| ALPINE | $726,200 | $497,450 |
| AMADOR | $726,200 | $472,030 |
| BUTTE | $726,200 | $472,030 |
| CALAVERAS | $726,200 | $472,030 |
| COLUSA | $726,200 | $472,030 |
| CONTRA COSTA | $1,089,300 | $1,089,300 |
| DEL NORTE | $726,200 | $472,030 |
| EL DORADO | $763,600 | $763,600 |
| FRESNO | $726,200 | $472,030 |
| GLENN | $726,200 | $472,030 |
| HUMBOLDT | $726,200 | $472,030 |
| IMPERIAL | $726,200 | $472,030 |
| INYO | $726,200 | $508,300 |
| KERN | $726,200 | $472,030 |
| KINGS | $726,200 | $472,030 |
| LAKE | $726,200 | $472,030 |
| LASSEN | $726,200 | $472,030 |
| LOS ANGELES | $1,089,300 | $1,089,300 |
| MADERA | $726,200 | $472,030 |
| MARIN | $1,089,300 | $1,089,300 |
| MARIPOSA | $726,200 | $472,030 |
| MENDOCINO | $726,200 | $546,250 |
| MERCED | $726,200 | $472,030 |
| MODOC | $726,200 | $472,030 |
| MONO | $726,200 | $693,450 |
| MONTEREY | $915,400 | $915,400 |
| NAPA | $1,017,750 | $1,017,750 |
| NEVADA | $726,200 | $644,000 |
| ORANGE | $1,089,300 | $1,089,300 |
| PLACER | $763,600 | $763,600 |
| PLUMAS | $726,200 | $472,030 |
| RIVERSIDE | $726,200 | $644,000 |
| SACRAMENTO | $763,600 | $763,600 |
| SAN BENITO | $1,089,300 | $1,089,300 |
| SAN BERNARDINO | $726,200 | $644,000 |
| SAN DIEGO | $977,500 | $977,500 |
| SAN FRANCISCO | $1,089,300 | $1,089,300 |
| SAN JOAQUIN | $726,200 | $656,650 |
| SAN LUIS OBISPO | $911,950 | $911,950 |
| SAN MATEO | $1,089,300 | $1,089,300 |
| SANTA BARBARA | $805,000 | $805,000 |
| SANTA CLARA | $1,089,300 | $1,089,300 |
| SANTA CRUZ | $1,089,300 | $1,089,300 |
| SHASTA | $726,200 | $472,030 |
| SIERRA | $726,200 | $472,030 |
| SISKIYOU | $726,200 | $472,030 |
| SOLANO | $726,200 | $685,400 |
| SONOMA | $861,350 | $861,350 |
| STANISLAUS | $726,200 | $517,500 |
| SUTTER | $726,200 | $488,750 |
| TEHAMA | $726,200 | $472,030 |
| TRINITY | $726,200 | $472,030 |
| TULARE | $726,200 | $472,030 |
| TUOLUMNE | $726,200 | $472,030 |
| VENTURA | $948,750 | $948,750 |
| YOLO | $763,600 | $763,600 |
| YUBA | $726,200 | $472,030 |
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California Conforming Loan Limits Increase In 2023
The 2023 California Conforming loan limit increase is one of the largest on record. On November 29, 2022, the Federal Housing Finance Agency released the following press release:
Washington, D.C. – The Federal Housing Finance Agency (FHFA) today announced the conforming loan limit values (CLLs) for mortgages to be acquired by Fannie Mae and Freddie Mac (the Enterprises) in 2023. In most of the United States, the 2023 CLL value for one-unit properties will be $726,200, an increase of $79,000 from $647,200 in 2022.
National Baseline
The Housing and Economic Recovery Act (HERA) requires that the baseline CLL for the Enterprises be adjusted each year to reflect the change in the average U.S. home price. Earlier today, FHFA published its third quarter 2022 FHFA House Price Index® (FHFA HPI®) report, which includes statistics for the increase in the average U.S. home value over the last four quarters. According to the nominal, seasonally adjusted, expanded-data FHFA HPI, house prices increased 12.21 percent, on average, between the third quarters of 2021 and 2022. Therefore, the baseline CLL in 2023 will increase by the same percentage.
High-Cost Area Limits
For areas in which 115 percent of the local median home value exceeds the baseline conforming loan limit, the applicable loan limit will be higher than the baseline loan limit. HERA establishes the high-cost area limit in those areas as a multiple of the area median home value, while setting the ceiling at 150 percent of the baseline limit. Median home values generally increased in high-cost areas in 2022, which increased their CLL. The new ceiling loan limit for one-unit properties will be $1,089,300, which is 150 percent of $726,200.
Special statutory provisions establish different loan limits for Alaska, Hawaii, Guam, and the U.S. Virgin Islands. In these areas, the baseline loan limit will be $1,089,300 for one-unit properties.
Due to rising home values, the CLLs will be higher in all but two U.S. counties or county equivalents.
Source: FHFA
Since 2008 the FHFA has used the HERA formula to calculate Conforming loan limits.
California Conforming Loan Limits Since 2015
Home values have increased over the last decade, and raising the Conforming loan limits allows more people to qualify for the best available mortgage rates. The Federal Housing Finance Agency annually updates its California Conforming loan limits.
Here are the California Conforming loan limits since 2015:
2015 California Conforming Loan Limits
The California Conforming Loan limit in 2015 was $417,000; in some high-cost counties, like Los Angeles and San Francisco, it was as high as $615,250 (source).
2016 California Conforming Loan Limits
The California Conforming Loan limit in 2016 was $417,000 (the same as in 2015), and in some high-cost counties, like Los Angeles and San Francisco, it was as high as $625,500 (source).
2017 California Conforming Loan Limits
The California Conforming Loan limit in 2017 was $424,100; in some high-cost counties, like Los Angeles and San Francisco, it was as high as $636,150 (source).
2018 California Conforming Loan Limits
The California Conforming Loan limit in 2018 was $453,100; in some high-cost counties, like Los Angeles, Orange, and Santa Clara, it was as high as $679,650 (source).
2019 California Conforming Loan Limits
The California Conforming Loan limit in 2019 was $483,350; in some high-cost counties, like Los Angeles, Orange, and Alameda, it was as high as $726,525 (source).
2020 California Conforming Loan Limits
The California Conforming loan Limit in 2020 was $510,400, and in some high-cost counties, like Los Angeles, Orange, San Mateo, and Alameda, it was as high as $765,600 (source).
2021 California Conforming Loan Limits
The California Conforming loan Limit in 2021 was $548,250. In some high-cost counties, like Los Angeles, Orange, San Mateo, and Alameda, it was as high as $822,375 (source).
2022 California Conforming Loan Limits
The California Conforming loan limit in 2022 was $647,200 for most counties, and in some high-cost counties, it’s as high as $970,800 (source).
2023 California Conforming Loan Limits
The 2023 California Conforming loan limit is $726,200 for most counties, and in some high-cost counties, it’s as high as $1,089,300 (source).
Conforming Loan Programs
Conforming loan programs are the most popular home loan programs out there. Below we cover everything you need to know about the various Conforming loan programs available to homebuyers and homeowners.
What Types Of Conforming Loans Are There?
The most popular Conforming loans are the 30-year Fixed-Rate Mortgage (FRM) and the 15-year fixed-rate home loan. Here is a complete list of all the fixed-rate mortgage options.
- 30-year fixed-rate
- 25-year fixed-rate
- 20-year fixed-rate
- 15-year fixed-rate
- 10-year fixed-rate
There are no fixed rate options below a 10-year fixed rate. Here are the Adjustable Rate Mortgage (ARM) options under the Conforming loan program:
- 5/1 Adjustable Rate Mortgage
- 7/1 Adjustable Rate Mortgage
- 10/1 Adjustable Rate Mortgage
The 10/1 ARM is the longest fixed-rate period under the Conforming loan ARM program. All Adjustable Rate Mortgages are based on a 30-year time period.
The first number (for example, 5/1) is the number of years the interest rate is fixed, and the second number represents how often the rate adjusts after the fixed-rate period. The fixed-rate period is always at the beginning. So a 5/1 ARM:
- The interest rate is fixed for the first five years and does not change.
- For the first five years, your payment does not change
- After the first five years, your rate adjusts once a year every year until year 30.
- Your monthly payment adjusts once a year after the fixed-rate period.
Requirements For Conforming Loan
A lot goes into getting qualified for a Conforming Loan, and the actual guide issued by Fannie Mae is over 1200 pages. We won’t go into everything; just the most essential areas you should be aware of as of January 1, 2023:
- The minimum down payment for a purchase is 3% down, and the minimum amount of equity in a home for a refinance is 3%.
- Generally speaking, you need above a 620 credit score to obtain a Conforming loan. And getting qualified for scores below 700 gets more difficult as you move further down.
- The debt-to-income ratio should be 50% or lower.
- Most Conforming loans do not need liquid asset reserves; however, some do. You’ll need to show some liquid reserves if purchasing or refinancing a rental property. If you have a low credit score, a debt-to-income ratio above 45%, and are taking cash out, you’ll need to show some liquid reserves.
Is A Conforming Loan A Conventional Loan?
A Conforming loan is a Conventional loan however not all Conventional loans are Conforming loans.
One type of Conventional loan that is not a Conforming loan is specifically geared toward self-employed people. The Bank Statement Mortgage allows borrowers to use their bank statement deposits to prove income (rather than tax returns).
Conforming Loans To Purchase A Home
The Conforming loan program offers some great opportunities for those looking to purchase a home. From First Time Home Buyers to seasoned investors, Conforming loans have low-interest rates at great terms.
You can put down as little as 3% and the loan process for a Conforming loan is very efficient as it allows for 2-3 weeks closing periods if the buyer and seller are in a rush to close quickly. Another great aspect of the Conforming loan program is that you might get an appraisal waiver, which helps save on costs and speeds up the process if granted.
Conforming Loans To Refinance A Current Mortgage
When it comes to refinancing a mortgage in California, the Conforming loan program is perhaps the most popular. Like purchases, you can get an appraisal waiver and you can close fairly quickly due to every loan being underwritten by the AUS of Fannie Mae or Freddie Mac.
If you want things to move quickly, have your income documentation, mortgage statement, and homeowners insurance information ready to go before applying. Conforming loan limits in California have increased over the last twenty years and that is expected to continue.
Conforming vs. FHA Loans
We’ve touched on the main difference between the two programs (one conforms to Fannie Mae/Freddie Mac standards and the other is backed by the U.S. government) and here we’ll touch on the differences between the two loan programs at the consumer level:
- Conforming loans are best for those with credit scores above 700 and FHA home loans are great for people with credit scores below 700
- Conforming loans can be used to purchase or refinance investment properties
- If you put down 20% or have 20% equity in your home then you will not have Mortgage Insurance with a Conforming loan
- FHA loans help those with small down payments/little equity that might not get qualified under a Conforming loan program
- With FHA loans you do not need liquid assets
- FHA loans can only be used on primary homes; you can not purchase a rental property with an FHA loan.
And just like Conforming loan limits in California, FHA has its own loan limits.
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Is A Conforming Loan Right For You?
If you have a credit score above 700 and a debt-to-income ratio below 50% then a Conforming loan might be right for you even if you only have 3% down or 3% equity (if you’re refinancing).
Conforming loans offer some of the best mortgage rates and for those with less than 20% down (or equity), you’ll have a lower Mortgage Insurance (MI) cost.
In addition to the lower MI cost, you’ll be able to get rid of the MI whereas, on an FHA loan, it’s permanent.
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