Fha Increases Hecm Limit To $1.25m In 2026

The Federal Housing Administration (FHA) said Thursday it will raise the maximum claim amount for Home Equity Conversion Mortgages (HECMs) to $1,249,125 in 2026, up from $1,209,750 this year.

The increase of about 3.3% applies to case numbers assigned on or after Jan. 1, 2026, and is a lower percentage increase than the roughly 5% gain in 2025.

The new limit also covers Freddie Mac’s special exception areas — Alaska, Hawaii, Guam and the U.S. Virgin Islands. The new limit, a $39,375 difference from last year, marks the 10th straight year of increases.

“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.”

FHA published the details in Mortgagee Letter 2025-22 and said the new policy will be added to a forthcoming update of its Single Family Housing Policy Handbook 4000.1.

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 America‘s 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 Financial‘s and Fairway Home Mortgage‘s reverse divisions advertise that they, too, allow access up to $4 million.

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.”