Q. What makes a loan a jumbo loan? Who determines this amount -- the bank or is it an industry standard?

A. Jumbo loans are mortgages too big to be bought by the two government-owned companies that provide the great majority of the money for home loans in this country.

Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corp.) do that by purchasing more than 80% of the loans made by commercial banks and mortgage companies.

Some of those mortgages they keep. Some they bundle together and sell to investors.

These loans are sometimes called conventional or conforming loans because they "conform" to Fannie's and Freddie's rules.

But Congress limits the size of loans Fannie Mae and Freddie Mac can buy. Right now, they're prohibited from buying loans larger than $417,000 in most places and no more than $729,750 in high-cost areas like New York and San Francisco.

If you want to borrow more than that, you must apply for a jumbo loan that banks must fund out of their own money or sell to private investors without any government help. Those loans always cost more (charge a higher interest rate) and usually require a larger down payment.

Here's where to check the conforming loan limits in your area.