A standard reverse mortgage stops counting your home’s value at $1,249,125. Private jumbo loans fill the gap, with fewer protections and terms that vary by lender. Here is how to weigh one.
A standard reverse mortgage (the FHA-insured HECM) only counts your home’s value up to $1,249,125 in 2026. If your home is worth more, the extra value is simply ignored. A jumbo (or “proprietary”) reverse mortgage is a private loan built for that gap: it can lend against a much more valuable home, but it isn’t insured by the FHA, it’s offered by a handful of lenders, and its rules and prices vary from lender to lender and state to state.
The table shows what a HECM can reach for a 72-year-old as the home’s value rises. Above the limit, the principal limit stops growing, so the share of the home you can reach keeps shrinking.
| Home value | Value HUD will count | HECM principal limit at 72 | Share of the home you can reach |
|---|---|---|---|
| $800,000 | $800,000 | $277,600 | 35% |
| $1,500,000 | $1,249,125 | $433,400 | 29% |
| $2,000,000 | $1,249,125 | $433,400 | 22% |
| $3,000,000 | $1,249,125 | $433,400 | 14% |
Assumptions: principal limit from HUD’s official table at a 7.68% expected rate; balance and unused credit line grow 7.5% a year (7.0% interest + 0.5% annual mortgage insurance); upfront costs = 2% FHA mortgage insurance + the HUD-capped origination fee + about $3,000 of other closing costs. Illustrations, not quotes. Your lender’s rate and a HUD counselor give exact figures.
For a $2,000,000 home, the HECM reaches only about a fifth of the value. That gap is the whole market for jumbo reverse mortgages.
Get at least two quotes, and compare them with what a HECM would give on the same home: on a home just above the limit, a HECM can still come out ahead, because its FHA insurance buys protections (a growing line of credit, HUD backing) a private loan may not match.
A homeowner whose house is worth well above the FHA limit, who plans to stay for the long term and needs more than a HECM can reach. If the home is only slightly above the limit, or you could live comfortably on what a HECM reaches, start with the HECM. If you might sell within a few years, selling and downsizing (see the comparison) usually costs less than either loan.
For an FHA-insured HECM, the maximum home value HUD will count is $1,249,125 for 2026. You can have a more valuable home, but value above the limit doesn’t increase what you can borrow.
A private (proprietary) reverse mortgage for homes worth more than the FHA limit. It isn’t FHA-insured, has no FHA mortgage insurance, and its terms vary by lender and state.
The big programs say they are: Finance of America and Longbridge state that borrowers and heirs never owe more than the home is worth. Because they aren’t FHA-insured, the protection comes from the loan contract and state law, so confirm it in writing.
Yes, in many states. Programs from Finance of America, Longbridge and Mutual of Omaha start at 55, with higher minimums in some states. The FHA-insured HECM requires the youngest borrower to be 62.
Educational, not individual financial advice. The Equity Ledger doesn’t originate loans. Reverse mortgages are complex and the right answer depends on your specific situation — confirm the details with a HUD-approved counselor before you decide.
Rules and figures are from U.S. government program materials current at publication; HECM limits and rates change — verify with HUD/FHA or a HUD-approved counselor.