Non-Conforming Loan is a mortgage loan that cannot be purchased or guaranteed by Fannie Mae or Freddie Mac because the principal loan amount is above the conforming loan limit set by Federal Housing Finance Agency. Since these loans have lower liquidity and carry higher interest rates and origination points.
Jumbo Loans are a type of non-conforming loans which exceed the conforming loan limits set by FHFA. In other words, Jumbo Loans are loans that do not meet the guidelines for Conforming Loans only because of the large loan size. Some institutions classify loans above $1 million as Super Jumbo Loans. The Conforming Loan Limit page contains the current loan limits beyond which the loans would be Jumbo Loans.
Updated: Jul 11, 2011