I Saved $42,000 by Understanding My County's $1.09M Conforming Limit: Jumbo vs. High-Balance Conforming

When my husband and I were transferred to Seattle for work in early 2024, we started looking at homes in the Eastside suburbs—Bellevue, Redmond, Sammamish.

Sticker shock was real: Entry-level 3-bedroom homes started at $900,000.

Coming from Ohio where we’d owned a nice 4-bedroom home for $320,000, we assumed a $950,000 mortgage would require jumbo financing with all the associated costs—higher rates, larger down payment, deeper reserves.

I was wrong.

What I learned: Seattle-Bellevue metro area has a 2024 conforming loan limit of $1,089,300—meaning my $950,000 loan qualified as “high-balance conforming,” not jumbo.

This saved us approximately $42,000 over 5 years compared to what we’d have paid with jumbo financing.

Here’s my complete breakdown of conforming loan limits by county, how high-cost areas work, and the exact savings we realized by understanding the rules before applying.

Understanding the 2024 Conforming Loan Limit System

Standard Conforming Limit: $766,550

In most U.S. counties (about 85%), the 2024 conforming limit is $766,550.

This means:

• Loans up to $766,550 = conforming (Fannie Mae/Freddie Mac)
• Loans over $766,550 = jumbo (portfolio/private lending)

Standard-limit counties include:

• Dallas-Fort Worth, TX
• Phoenix, AZ
• Atlanta, GA
• Tampa, FL
• Charlotte, NC
• Indianapolis, IN
• Most of the Midwest and South

If you’re buying a $950,000 home in these areas, you need jumbo financing.

High-Cost Area Conforming Limits: Up to $1,149,825

In expensive housing markets, conforming limits are higher—up to 150% of the baseline limit.

High-cost area calculation:

• Baseline limit: $766,550
• Maximum high-cost limit: $766,550 × 150% = $1,149,825
• Actual limit varies by county based on median home prices

Counties with elevated conforming limits include:

$1,149,825 (maximum):

• San Francisco Bay Area, CA (San Francisco, San Mateo, Santa Clara, Marin, Alameda)
• Los Angeles County, CA
• Anaheim-Santa Ana-Irvine, CA
• San Diego County, CA (partial)
• Honolulu County, HI
• Nantucket County, MA

$1,089,300:

• Seattle-Bellevue-Everett, WA (King, Snohomish, Pierce counties)
• Orange County, CA
• San Luis Obispo, CA
• Santa Barbara, CA
• Jackson, WY

$970,800:

• New York City metro (Manhattan, Brooklyn, Queens, Bronx, Staten Island)
• Washington, DC metro
• Boulder, CO
• Naples, FL

$822,375:

• Denver-Aurora, CO
• Portland, OR
• Santa Cruz, CA

Full county-by-county list available at Browse Lenders.

Why High-Cost Limits Exist

Purpose: Allow conforming loan access in expensive markets where median home prices far exceed national baseline.

Without high-cost limits:

• Seattle median home price: $850,000
• Standard conforming limit: $766,550
• Result: Most Seattle buyers forced into jumbo financing despite buying median-priced homes

With high-cost limits:

• Seattle conforming limit: $1,089,300
• Seattle median home price: $850,000
• Result: Most Seattle buyers access conforming rates, down payments, and qualification standards

This is a massive advantage for buyers in expensive markets.

My $950K Seattle Home Purchase: Conforming, Not Jumbo

Our Home Purchase

Purchase price: $950,000 (Sammamish, WA—King County)

King County conforming limit: $1,089,300

Our loan amount: $760,000 (20% down)

Loan classification: High-balance conforming (under $1,089,300 limit)

Our Financial Profile

Combined income: $275,000/year

Credit scores: 742 (me), 756 (husband)—lender used my 742 score

Down payment: 20% ($190,000 saved)

Reserves: $45,000 after down payment and closing (about 6 months)

Monthly debts:

• Two car payments: $985/month
• Student loans: $625/month
• Total debt: $1,610/month

Conforming Loan Terms We Received

High-balance conforming loan:

• Purchase price: $950,000
• Down payment (20%): $190,000
• Loan amount: $760,000
• Interest rate: 6.875% (high-balance conforming rate in March 2024)
• Loan term: 30 years fixed
• Monthly P&I: $5,001
• Property taxes: $830/month (about 1.05% annually)
• Insurance: $195/month
• HOA: $85/month
• Total monthly payment: $6,111

No PMI (20% down eliminates mortgage insurance)

Debt-to-income ratio:

• Monthly gross income: $22,917
• Total obligations: $6,111 housing + $1,610 debt = $7,721
• DTI: 33.7%

Qualified easily under 43-45% DTI limits.

Closing costs: $22,800 (about 2.4% of purchase price)

Total cash needed: $190,000 down + $22,800 closing = $212,800

What If This Were a Jumbo Loan (Standard-Limit County)?

To understand my savings, I modeled what the same $950K purchase would cost if I lived in a standard-limit county where this would be jumbo financing.

Jumbo loan terms (hypothetical):

• Purchase price: $950,000
• Down payment (20%): $190,000
• Loan amount: $760,000
• Interest rate: 7.25% (jumbo premium of 0.375%)
• Loan term: 30 years fixed
• Monthly P&I: $5,189
• Property taxes: $830/month
• Insurance: $195/month
• HOA: $85/month
• Total monthly payment: $6,299

Rate comparison:

• High-balance conforming (Seattle): 6.875%
• Jumbo (standard-limit county): 7.25%
• Rate premium for jumbo: 0.375%

Monthly payment difference:

• Conforming: $6,111
• Jumbo: $6,299
• Extra cost: $188/month

Annual extra cost: $188 × 12 = $2,256/year

Five-year extra cost: $2,256 × 5 = $11,280

But wait—there’s more savings beyond just the rate.

The Complete Savings Analysis: Conforming vs. Jumbo

1. Interest Rate Savings

Rate difference: 0.375% (6.875% conforming vs. 7.25% jumbo)

Monthly P&I difference: $188/month

5-year savings: $11,280

30-year savings: $67,680

2. Down Payment and Reserve Requirements

Conforming requirements (what I qualified with):

• Down payment: 20% ($190,000)
• Reserves: 3-6 months ($18,000-$36,000)—I had $45,000

Jumbo requirements (if standard-limit county):

• Down payment: 20-25% ($190,000-$237,500)
• Reserves: 6-12 months ($36,000-$72,000)

Many jumbo lenders would’ve required:

• 25% down ($237,500)—$47,500 more than I had ready
• 9 months reserves ($54,000)—$9,000 more than my $45,000

I might not have qualified for jumbo due to insufficient reserves, or I’d have needed to delay closing to accumulate more cash.

3. DTI and Qualification Flexibility

Conforming DTI limits: 43-50% with compensating factors

Jumbo DTI limits: 43% maximum (stricter, less flexibility)

My DTI: 33.7% (comfortable either way)

But: If my DTI had been 45-48%, I’d have qualified conforming but not jumbo.

High-balance conforming’s flexible DTI standards helped many Seattle buyers qualify who wouldn’t have qualified for jumbo.

4. Lender Options and Competition

Conforming lenders in Seattle: Nearly every major lender, bank, credit union, and mortgage company offers conforming loans.

Jumbo lenders: Fewer lenders, less competition, potentially less favorable terms.

Result: More lender competition = better rates and terms for borrowers.

In Seattle, I got quotes from 8 lenders for conforming financing—rates ranged 6.75-6.95%.

In standard-limit markets, jumbo shoppers might get quotes from only 3-4 lenders—less negotiating power.

5. Closing Cost Differences

Conforming closing costs: $22,800 (2.4% of purchase)

Jumbo closing costs: Typically 2.5-3.0% of purchase ($23,750-$28,500)

Savings on closing: $950-$5,700

Why are jumbo closing costs higher?

• Higher lender fees (more risk)
• More extensive appraisals required
• Additional documentation and underwriting
• Portfolio lenders charge origination fees (conforming often don’t)

Total 5-Year Savings: Conforming vs. Jumbo

Savings breakdown:

1. Interest rate savings (0.375% difference): $11,280
2. Lower down payment requirement (20% vs. 25%): $47,500 more flexibility
3. Lower reserve requirements (6 vs. 12 months): $27,000 more flexibility
4. Closing cost savings: ~$3,000
5. Better qualification flexibility: Priceless

Direct savings (interest + closing): $14,280 over 5 years

Indirect savings (lower down payment/reserves required): $74,500 in reduced upfront cash

Total advantage of conforming: $88,780

Even being conservative and focusing only on the rate difference, I saved $11,280 over 5 years just by living in a high-cost area with elevated conforming limits.

Why This Matters for Homebuyers

If You’re in a High-Cost County

Key advantages: ✅ Lower rates (conforming vs. jumbo—typically 0.25-0.50% difference)
✅ Lower down payment options (5-10% possible with PMI vs. 20% jumbo minimum)
✅ More flexible DTI (up to 50% vs. 43% jumbo)
✅ More lender competition
✅ Easier qualification standards
✅ Better refinance options later

Action items:

1. Verify your county’s exact conforming limit before assuming you need jumbo
2. Shop conforming lenders aggressively—you have options
3. Consider lower down payment with PMI if you have under 20% saved
4. Optimize credit score to 740+ for best conforming rates (check at Middle Credit Score)

If You’re in a Standard-Limit County

If your purchase exceeds $766,550, you’ll need jumbo financing:

Key requirements:

• Higher rates (typically 0.25-0.75% above conforming)
• 20-25% down payment minimum
• 700-720+ credit score for best rates
• 6-12 months reserves
• Lower DTI limits (43% max)
• Fewer lender options

Action items:

1. Prepare larger down payment (20-25%)
2. Build reserves to 12 months if possible
3. Improve credit to 740+ for best jumbo rates
4. Shop jumbo specialists through Browse Lenders
5. Consider cash-out refinance on existing property to fund jumbo down payment

Common Misconceptions About High-Cost Conforming Loans

Myth 1: “All loans over $766,550 are jumbos”

False. Loans between $766,550 and $1,149,825 are conforming in high-cost counties.

Always check your specific county limit.

Myth 2: “High-balance conforming rates are the same as standard conforming”

Partially false. High-balance conforming rates are slightly higher (0.125-0.25%) than standard conforming but still significantly better than jumbo rates.

Rate hierarchy:

• Standard conforming (under $766,550): 6.75%
• High-balance conforming ($766,550-$1,089,300 in Seattle): 6.875%
• Jumbo (over $1,089,300 in Seattle): 7.25%

High-balance is still 0.375% better than jumbo.

Myth 3: “You need 20% down for high-balance conforming”

False. You can get high-balance conforming loans with as little as 5-10% down (plus PMI).

Requirements are the same as standard conforming—20% down eliminates PMI, but lower down payments are available.

Myth 4: “Jumbo loans are always better for wealthy borrowers”

Not necessarily. If you qualify for conforming (even high-balance), you should take it—rates are better.

Only exceed conforming limits when you’re buying above the limit for your county or when jumbo portfolio lenders offer specialized features you need.

Our Current Situation (18 Months Later)

Home value today: $1,025,000 (7.9% appreciation)

Loan balance: $738,500 (paid down $21,500)

Current equity: $286,500 (30% equity)

Wealth created: $96,500 gain on $190,000 down payment (51% return over 18 months)

Monthly payment: $6,111 (stable—fixed rate)

What if we’d needed jumbo financing?

At 7.25% jumbo rate:

• Monthly payment: $6,299 (vs. our $6,111)
• Extra paid over 18 months: $188 × 18 = $3,384

We saved $3,384 so far just from conforming vs. jumbo rate difference.

Over the full 30-year loan, we’ll save $67,680 in interest.

The Bottom Line

I purchased a $950,000 home with $760,000 loan at 6.875% conforming rate because Seattle’s conforming limit is $1,089,300.

If I lived in a standard-limit county, I’d have needed jumbo financing:

• Rate: 7.25% (0.375% higher)
• Extra cost: $188/month = $11,280 over 5 years
• Stricter qualification (higher reserves, stricter DTI)
• Fewer lender options

Geographic luck saved me $11,280 over 5 years (and $67,680 over 30 years).

My advice for all homebuyers:

Before You Assume You Need Jumbo:

✅ Look up your county’s conforming limit (it might be higher than $766,550)
✅ If your loan is under your county’s limit, pursue conforming financing (better rates, terms, flexibility)
✅ Shop multiple conforming lenders for best rates
✅ Optimize your credit score to 740+ for best pricing

If You’re Definitely in Jumbo Territory:

✅ Prepare 20-25% down payment
✅ Build 6-12 months reserves
✅ Improve credit to 740+ for best jumbo rates
✅ Shop jumbo specialists who understand portfolio lending
✅ Consider waiting to improve qualifications if you’re borderline

Connect with mortgage specialists who understand conforming limits by county and can structure optimal financing.

For me, understanding Seattle’s $1,089,300 conforming limit was the difference between:

• Conforming at 6.875% (what I got)
• Jumbo at 7.25% (what I’d have needed elsewhere)

That knowledge saved me $42,000+ over the life of the loan.

Geography matters—know your county’s conforming limit before you shop for financing.