What is a non-conforming loan, and how does it work?

Many home buyers use a conforming loan when buying a home. These loans are considered lower risk to mortgage lenders because the maximum amount you can borrow is capped by the Federal Housing Finance Agency (FHFA). But if you want to borrow more money than you can get with a conforming loan, you may need a non-conforming loan. Here’s what you need to know. What is a non-conforming loan? An oversimplified way of defining a non-conforming loan is to say it is not a conforming loan. To better grasp non-con ...