A new year means a new lending limit! The Federal Housing Administration (FHA) recently announced that the national lending limit for the HECM Reverse Mortgage Program has increased from $970,800 to $1,089,300 – effective January 1, 2023.
This latest increase is one of the biggest ever in the history of the FHA program – and the first time that the lending limit has soared over $1 million.
Why is this great news for those considering a reverse mortgage?
Essentially, it means that borrowers with higher home values will now be able to access additional equity from their homes. Bottom line: the higher the lending limit, the more cash available.
Here’s a comparison based on a 75-year-old homeowner with a home value of $975,000 or above:
- 2022 – Total available proceeds = $459,188
- 2023 – Total available proceeds = $515,238 – That’s a $56,050 increase!*
With a Home Equity Conversation Mortgage, borrowers are required to pay off existing mortgages before obtaining the new HECM loan. While some borrowers with high mortgage balances may not have been able to secure enough proceeds to qualify previously under the 2022 lending limit, thanks to the 2023 increase, there may now be enough to make it work.
Could now be the right time for you to get a reverse mortgage? To learn more about HECM lending limits and how to qualify for the loan program, give us a call today. We are here to help and are happy to discuss all your options. To learn more, call (855) 523-4326.