Reverse Mortgage Loan Limits Increase for 2021

Calculate Your Eligibility

It has been announced by the U.S. Department of Housing and Urban Development (HUD), that the Maximum Claim Amount (MCA) will be increased for reverse mortgages effective January 1, 2021.1 The MCA will increase almost $57,000 from $765,600 to $822,375.

This is the fifth straight year that the FHA has increased the Home Equity Conversion Mortgage (HECM) limit. In 2018, the loan limit was $675,650, leading to HECM loan limits improving by almost $147,000 in three years.  The new limit allows borrowers who have higher home values the ability to access more equity than what was permissible in 2020.  The increase may help senior homeowners access more funds, refinance their existing reverse mortgage, or even benefit those who weren’t able to previously qualify for the product.

A HECM loan, also known as a reverse mortgage, is a Federal Housing Administration (FHA)2 insured loan allowing borrowers who are 62 years of age and older to access a portion of their home’s equity without having to make monthly mortgage payments.3

Reverse mortgage loans are insured by the government and are non-recourse loans and the borrower will never have to repay more than the value of their home if they decide to sell.  Borrowers can continue to age in place as long as they make property tax and insurance payments, keep the home in good repair, and retain it as their primary residence.

Reverse Mortgage Loan Limits Increased for 2021

If you are looking to access your home equity as an additional source of funds in retirement, this increase in MCA may benefit you. Call 1-800-976-6211 to speak with a licensed loan advisor for more information.


Applies only to loans with case numbers assigned on or after January 1, 2021.

Federal Housing Administration (FHA) mortgage insurance premiums (MIP) will accrue on  your loan balance. You will be charged an initial. MIP at closing. The initial MIP will be 2% of the home value not to exceed $12,723. Over the life of the loan, you will be charged an annual MIP that equals .5% of the outstanding mortgage balance.

3 Your current mortgage, if any, must be paid off using the proceeds from your HECM loan.  You must still live in the home as your primary residence, continue to pay required property taxes, homeowners insurance, and maintain the home according to FHA requirements.  Failure to meet these requirements can trigger a loan default that may result in foreclosure.