A jumbo loan, also known as a jumbo mortgage, is a type of home mortgage that exceeds the lending limits set by the Federal Housing Finance Agency (FHFA) for conventional mortgages. Unlike those mortgages, a jumbo loan is not eligible to be purchased, guaranteed, or securitized by Fannie Mae or Freddie Mac. Lenders offer jumbo loans to finance luxury properties and homes in very expensive local real estate markets and have more stringent underwriting requirements for them.