2025 HECM Reverse Mortgage Limits Surge to $1,209,750
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Michael G. Branson, CEO of All Reverse Mortgage, Inc., and moderator of ARLO™, has 45 years of experience in the mortgage banking industry. He has devoted the past 20 years to reverse mortgages exclusively. (License: NMLS# 14040) |
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All Reverse Mortgage's editing process includes rigorous fact-checking led by industry experts to ensure all content is accurate and current. This article has been reviewed, edited, and fact-checked by Cliff Auerswald, President and co-creator of ARLO™. (License: NMLS# 14041) |
Michael G. Branson
Cliff Auerswald
Our guide breaks down the FHA’s decision in an easy-to-understand format. We’ve included handy tables comparing the reverse mortgage loan limits of 2024 and 2025, showing you exactly how much more you can borrow. Plus, a “2025 Loan-To-Value Comparison” table illustrates how much of your home’s value you can tap into with these new lending limits.
This article, backed by data and expert analysis, is designed to be your one-stop guide to understanding the changes in HECM limits for 2025.
Exciting News: HUD Increases Reverse Mortgage Lending Limits for 2025!
It’s that time of year again when HUD reviews last year’s lending activity and sets new limits for the upcoming year. We’re thrilled to announce another record-high lending limit for reverse mortgages in 2025.
Starting January 1, 2025, HUD will increase the lending limit for the Home Equity Conversion Mortgage (HECM) program to $1,209,750—an increase of nearly $60,000 from last year’s limit. Borrowers with case numbers assigned on or after January 1 can benefit from the new limit.
Why is this great news? The higher limit can help homeowners with higher-value properties access more funds. For many, what used to be considered a “high-value home” is now closer to a median-priced home in today’s market. These increases allow more retirees to pay off existing loans or achieve their financial goals using a reverse mortgage.
Even better, this increase comes as the Federal Reserve begins lowering interest rates. Lower rates mean borrowers can access even more funds. The combination of higher lending limits and lower rates makes 2025 an excellent time to consider a reverse mortgage.
Check out the updated charts below to see how much you could receive with these changes. Here’s to a happy and financially secure 2025!
2025 vs. 2024 HECM Reverse Mortgage Limits by Age
| Your Age | Loan-to-Value | 2024 Limit ($1,149,825) | 2025 Limit ($1,209,750) | Extra Cash in 2025 |
|---|---|---|---|---|
| 62 | 36.9% | $425,435 | $447,607 | $22,172 |
| 65 | 39.2% | $450,731 | $474,222 | $23,491 |
| 70 | 42.0% | $484,076 | $509,304 | $25,228 |
| 75 | 45.4% | $523,170 | $550,436 | $27,266 |
| 80 | 50.4% | $553,065 | $610,923 | $57,858 |
| 85 | 56.8% | $653,100 | $687,138 | $34,038 |
| 90 | 63.7% | $733,588 | $771,820 | $38,232 |
| Note: Based on homes valued at $1,209,750+ with a 5.9% expected rate (1.50% CMT Margin). | ||||
History of HECM Lending Limits
HUD Lending limits have changed over time to keep up with rising home values, giving older homeowners access to more equity. Knowing how these limits have increased can help you decide if a reverse mortgage is right for you.
In 2008, HUD created a single national lending limit of $417,000, replacing limits that used to vary by region. This made reverse mortgage limits the same for everyone, no matter where they lived. Then, in 2009, the Housing and Economic Recovery Act raised the limit to $625,500 to help homeowners during the housing crisis.
Gradual Increases Through 2017
For eight years, the limit stayed at $625,500. In 2017, it increased slightly to $636,150. While this wasn’t a big jump, it marked the beginning of steady annual increases.
- In 2018, the limit rose to $679,650, a $43,500 increase.
- In 2019, it increased by $46,875, reaching $726,525, making it easier for homeowners to refinance their reverse mortgages.
- In 2020, the limit climbed to $756,600, an increase of $39,075.
Larger Increases During the Pandemic
The COVID-19 pandemic caused home values to rise quickly, and lending limits followed.
- In 2021, the limit increased by $56,775 to $822,375.
- In 2022, there was a record-setting jump of $148,425, bringing the limit to $970,800. This reflected the sharp rise in home prices.
Recent Growth and Looking Ahead to 2025
The trend of increasing limits has continued.
- In 2024, the limit increased significantly to $1,209,750.
- By 2025, it is expected to rise further to $1,209,750, allowing homeowners even more access to their home equity.
What This Means for You
These increases give older homeowners more financial flexibility. Whether you want to pay off an existing mortgage, refinance, or use your home equity to fund retirement, higher lending limits mean more options.
HECM Reverse Mortgage Limit History: 2016-2025
| Year | HECM Limit | Increase (%) |
|---|---|---|
| 2016 | $417,000 | 14.9% |
| 2017 | $636,150 | 52.5% |
| 2018 | $679,650 | 6.8% |
| 2019 | $726,525 | 6.8% |
| 2020 | $765,600 | 5.37% |
| 2021 | $822,375 | 7.41% |
| 2022 | $970,800 | 18% |
| 2023 | $1,089,300 | 12.2% |
| 2024 | $1,149,825 | 5.56% |
| 2025 | $1,209,750 | 5.21% |
| Note: National limit began in 2016, replacing lower regional limits. | ||
Also See: History of the Reverse Mortgage – 1969 to Present Day Facts
Comparing HECM to Jumbo Reverse Mortgage Limits
In 2025, the HUD Home Equity Conversion Mortgage (HECM) lending limit will surpass $1,000,000 for the second time, reaching $1,209,750. This increase offers an appealing option for homeowners with properties valued at more than $1,200,000, making HECM a competitive alternative to proprietary or jumbo reverse mortgage programs. It also represents one of the highest percentage increases in recent years.
Comparing HECM and Jumbo Reverse Mortgage Limits
In 2025, the HUD Home Equity Conversion Mortgage (HECM) lending limit will surpass $1,200,000 for the second time, reaching $1,209,750. This increase offers an appealing option for homeowners with properties valued at more than $1,200,000, making HECM a competitive alternative to proprietary or jumbo reverse mortgage programs. It also represents one of the highest percentage increases in recent years.
When to Consider Jumbo Reverse Mortgages
If your property is valued above $1,209,750, a proprietary (jumbo) reverse mortgage may be worth exploring. However, the HUD HECM program often allows borrowers to access a larger percentage of their property’s value compared to jumbo loans. For many homeowners, this makes a HECM loan a better choice, even if the property’s value exceeds the HUD lending limit.
That said, jumbo reverse mortgages offer unique advantages. These proprietary programs can provide access to cash in ways that differ from HUD-backed loans, giving borrowers flexibility depending on their financial goals.
Choosing the Right Option
The best loan option depends on your specific needs and goals. Speak with one of our reverse mortgage specialists to compare HECM and jumbo programs. We can help you understand which loan best suits your situation and ensure you get the most value from your home equity.
2025 HECM vs. Jumbo Reverse Mortgage: Which Pays More?
| Home Value | HECM Cash (2025) | Jumbo Cash (2025) | Your Net Gain |
|---|---|---|---|
| $1,250,000 | $509,304 | $487,500 | -$21,804 |
| $1,300,000 | $509,304 | $507,000 | -$2,304 |
| $1,400,000 | $509,304 | $546,000 | $36,696 |
| $1,500,000 | $509,304 | $585,000 | $75,696 |
| $1,750,000 | $509,304 | $682,500 | $173,196 |
| $2,000,000 | $509,304 | $780,000 | $270,696 |
| $2,250,000 | $509,304 | $877,500 | $368,196 |
| $2,500,000 | $509,304 | $975,000 | $465,696 |
| $2,750,000 | $509,304 | $1,072,500 | $563,196 |
| $3,000,000 | $509,304 | $1,170,000 | $660,696 |
| Note: Based on age 70; HECM LTV 42% (1.50% CMT Margin), Jumbo LTV 39%. | |||
Summary
In 2025, the reverse mortgage lending limit will rise to $1,209,750—an increase of $60,000. This adjustment is based on home price growth data prior to rising interest rates. However, many markets are already showing signs of price softening, and further declines could lead to reduced lending limits in the future.
The higher lending limits are especially helpful for borrowers with larger existing mortgages who want to retire their loans. However, rising interest rates have impacted the available principal limits, leaving many borrowers surprised by how much their eligibility has changed since the start of the year.
For homeowners with higher-valued properties, this increase in the 2025 lending limit offers a welcome opportunity to access more home equity, even as inflation and interest rates continue to challenge the financial landscape.
Lending Limit FAQs
What is the maximum reverse mortgage loan limit for 2025?
The maximum reverse mortgage loan limit will be $1,209,750 in 2025. The limit on the reverse mortgage is not the maximum loan amount but the maximum property value that can be used to calculate your available loan amount.
Would a reverse mortgage refinance in 2025 be worthwhile?
What is the maximum amount you can get on a HECM reverse mortgage?
How is the HECM limit decided, and by whom?
How is the principal limit determined on a reverse mortgage?
Source:
2025 HECM limit details were published in Mortgagee Letter 2024-21 and will be included in a future Single Family Housing Policy Handbook 4000.1 (Handbook 4000.1) release.
August 27th, 2024
August 31st, 2024