"The steps taken by FHA today to increase HECM loan limits provide greater flexibility for America's older homeowners to monetize their home equity as part of a comprehensive retirement plan to meet everyday retirement needs, Steve Irwin, president of the National Reverse Mortgage Lenders Association (NRMLA), said in a statement. We appreciate the leadership at FHA for recognizing this critical need."
"The new limits come a little over three weeks after the Federal Housing Finance Agency (FHFA) raised the 2026 conforming loan limit by 3.25% to $832,750, with high-cost area ceilings set at $1,249,125 for Fannie Mae and Freddie Mac. In its announcement, FHFA wrote: According to the nominal, seasonally adjusted, expanded-data FHFA HPI, house prices increased 3.26%, on average, between the third quarters of 2024 and 2025. Therefore, the baseline CLL in 2026 will increase by the same percentage."
"Proprietary (or jumbo) reverse mortgages, which are privately insured and not federally backed, generally have higher maximum limits than HECMs, allowing borrowers to access larger loan amounts. For example, Finance of Americas HomeSafe suite of jumbo reverse mortgages offers homeowners 55 and older in certain areas options for getting the most out of their home's equity, including loans up to $4 million. Longbridge Financials and Fairway Home Mortgages reverse divisions advertise that they, too, allow access up to $4 million."
FHA increased the Home Equity Conversion Mortgage (HECM) loan limit by $39,375, marking the 10th consecutive annual rise and extending coverage to Freddie Mac exception areas including Alaska, Hawaii, Guam and the U.S. Virgin Islands. FHA published the change in Mortgagee Letter 2025-22 and will update the Single Family Housing Policy Handbook 4000.1. The increase aims to give older homeowners more flexibility to use home equity for retirement needs. Proprietary jumbo reverse mortgages offer higher maximums, with some products available up to $4 million. FHFA separately raised 2026 conforming loan limits based on a 3.26% house price increase.
Read at www.housingwire.com
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