FHFA announces rising conforming loan limits for 2026

Real estate investors scaling multi-unit portfolios often face constraints related to tax optimization and income requirements. While traditional financing through Fannie Mae and Freddie Mac relies on strict thresholds and personal income verification, asset-based financing using Debt Service Coverage Ratio (DSCR) loans can allow for continued scaling based on a property's net operating income.

The Federal Housing Finance Agency (FHFA) announced that conforming loan limit values (CLLs) will rise in 2026. For standard cost areas, the baseline for one-unit properties will increase by $26,250 to $832,750. The limit for two-unit properties will rise to $1,066,250, while four-unit properties will see a limit of $1,601,750. In high-cost markets, these ceilings are higher; for example, the two-unit limit in Los Angeles County is $1,599,375.

Traditional lenders typically require two years of tax returns and impose debt-to-income (DTI) ceilings between 45% and 50%. Many also follow the 28/36 rule, which limits housing costs to 28% of gross monthly income and total debt to 36%.