conforming mortgage

Definition

A home mortgage that complies with lending parameters set forth by Fannie Mae and Freddie Mac governing maximum loan amount, down payment amount, income requirements, and credit rating. Conforming mortgages are packaged and traded as securities. Because all mortgages in this category must meet specific guidelines, they are considered low risk - making the securities products based on such mortgages lower risk as well.
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conforming loan limit conformity