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UPDATE: 2023 Conventional Loan Limits — Here's What You Need To Know

Certified Mortgage Advisor
NMLS 1701021
November 30, 2022

New Loan Limits, is it better?

We have 2023 conventional loan limits just released at $726,200. This is a $79,000 increase or about 12.21% from last year's 647,200.

Now, if you're not familiar, conventional loans do have a limit to the maximum loan size you can get. And this does actually change depending on how much money you put down, how many units you're buying and where you're buying in the US.

Connection of Loan Limits to Home price

So the loan limits are based on the home price appreciation throughout the US. So you can see from 2012 and quarter three all the way to 2022. Q3, we had a 12.4% year-over-year home appreciation in the home price index. So this means that a home that you. Last year will have appreciated by 12.4%.

What are the changes?

Do conventional loans raise their limits by about the same amount for the upcoming year? Now, this limit does change based on how many units you're purchasing. So most people are gonna be looking at a one-unit home, all the way up to maybe a four-unit home. This is gonna be for a primary residence, meaning you're going to live in the home for at least one year. So you can see the loan limit again for a one-unit is $726,200, all the way up to a four-unit. 1000, almost four 1.4 million as the maximum loan limit.

Now, this is just a loan limit. You can actually purchase a home that is higher than this amount based on the amount that you put down. So for a first-time home buyer in a non-high-cost area, which I'll explain here in just a second, you can put a minimum of 3% down on a conventional.

That means that with a $726,200 loan limit, your maximum purchase price is just shy of $750,000. Same thing with up to this four-unit, 1.4 million loan. Doing 25% down would allow you to purchase a four-unit for up to 1.8 million.


What you wanna do as well is also use the FHFA Map, because you wanna look at where you're at in high-cost areas.

There's two kind of big things we need to look out

Number one is that if you are in a high-cost area, conventional loans do require a 5% down. Also, if you're not a first-time home buyer, then you're going to need to put 5% down on a conventional loan as well. Now, for all these areas herein.

These are going to be eligible for 3% down if you're a first-time home buyer, and they're gonna have the standard-based loan limits that you saw on the previous slide. So what you wanna do is go to the FHFA Map, if you're buying in one of the yellow or orange areas, the base loan limit is going to be raised because these are what are called High Cost of Living Areas. These will go all the way up to just over $1 million on a one-unit home.


So, for instance, let's say you're buying in Davidson County, the loan limit is $890,000 on a one-unit home, again, eligible for 5% down. If you're looking at somewhere like Los Angeles County, that goes all the way up to just over $1 million as the loan limit. And of course, you can put 5% down on that to raise the purchase price.

Check this out!

So this is just one piece of conventional loans to learn everything that you need to know about a conventional loan you can click here.

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Kyle Andrew Seagraves is Federal Mortgage Loan Originator (NMLS 1701021) licensed in all 50 states with the Dan Frio Team at Allied First Bank (NMLS 203463), an Equal Housing Lender. Separately, Kyle owns Win The House You Love LLC, an education company. Win The House You Love LLC is not a lender, does not issue loan qualifications, and does not extend credit of any kind. This website is only for educational usage. All calculations should be verified independently. This website is not an offer to lend and should not directly be used to make decisions on home offers, purchasing decisions, nor loan selections. Not guaranteed to provide accurate results, imply lending terms, qualification amounts, nor real estate advice. Seek counsel from a licensed real estate agent, loan originator, financial planner, accountant, and/or attorney for real estate, legal, and/or financial advice.

Servbank is not affiliated with the VA, FHA or any other government agency. This site has not been approved by any government agency.
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