Definition: A mortgage that does not meet the applicable purchase or eligibility standards for conforming loans, such as loan-size or underwriting requirements.
Example
A jumbo mortgage exceeds the applicable conforming loan limit.
Keep the distinction clear
Nonconforming does not automatically mean illegal or poor quality. Loan limits and program standards change, and a loan may be nonconforming for reasons other than size.
Related terms
Conforming Loan · Conventional Loan · Underwriting
Keep studying
References: CFPB: conventional loans
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