How Much Can You Borrow on a Reverse Mortgage?

How much can you borrow on a reverse mortgage depends on three things and nothing else: the age of the youngest borrower, the current expected interest rate, and the value of the home up to the 2026 FHA lending limit of $1,249,125. Run those three through HUD's published table and you get a percentage of the home's value, called the principal limit. For most borrowers in their late sixties and seventies that percentage lands somewhere between roughly 39 and 48 percent of value, before costs.

The reason this question is hard to answer online is that the honest answer is a formula, not a number, and most pages either dodge it or bury it behind an email capture. So this page walks the actual calculation, uses HUD's real published factors, and shows what comes out before you see the money.

This material is not from HUD or FHA and was not approved by HUD or a government agency. A reverse mortgage is a loan that must be repaid, not a government benefit. Program rules and figures are set by HUD and FHA, are current as of August 2026, and can change.

How Much Can You Borrow on a Reverse Mortgage: The Short Answer

HUD states the inputs plainly. The amount available for withdrawal varies by borrower and depends on the age of the youngest borrower or eligible non-borrowing spouse, the current interest rate, and the lesser of the appraised value, the HECM FHA mortgage limit, or the sales price.

That third input is the one people misread. If your Bend home appraises at $900,000, the calculation uses $900,000. If it appraises at $1.6 million, the calculation still uses $1,249,125, because that is the 2026 ceiling. Value above the cap does not disappear, it simply stops counting toward a HECM, which is when a proprietary product becomes the conversation instead.

Notice what is not on the list. Not your credit score, not your income, not your retirement account balance. Those come up in the financial assessment, which is about whether you can keep up with property taxes and insurance, not about how large a loan you get. That distinction surprises nearly everyone I sit down with.

Principal Limit Factors: What HUD's Table Actually Says

The percentage HUD applies to your home value is called a principal limit factor. HUD publishes the entire table, one factor for every combination of age and expected interest rate, and every lender in the country uses the same one. Nobody has a better table. The figures below come straight from HUD's published PLF table, in effect for FHA case numbers assigned on or after October 2, 2017 under Mortgagee Letter 2017-12.

Two columns tell you a lot. Read down either one and you see the age effect: roughly six to seven tenths of a percentage point of extra borrowing capacity for each year of age through the sixties and seventies, then well over a full point a year once you pass eighty. Read across a row and you see the rate effect: half a point of expected rate costs a 70-year-old about 2.3 percent of the home's value.

These are HUD's published factors, not a rate quote and not an offer. The expected rate on your file is set when your case number is assigned, so the column that applies to you is the one in effect that week, and I cannot promise which one that will be.

How Much Can You Borrow on a Reverse Mortgage in the First Year?

Here is the rule that catches people out, and it is the single most common reason a quoted figure feels smaller than expected. Your principal limit is not all available on day one.

Under 24 CFR 206.25, the maximum you can draw at closing and during the first twelve-month disbursement period is capped. FHA currently sets that cap at the greater of 60 percent of the principal limit, or your mandatory obligations plus an additional 10 percent of the principal limit. Mandatory obligations are the things that have to be paid at closing anyway: an existing mortgage being paid off, the initial mortgage insurance premium, the origination fee, the counseling fee, and customary third-party closing costs.

So if you are paying off a large existing mortgage, the second branch of that test is what governs and you may access well past 60 percent. If you own free and clear, the 60 percent branch governs, and the remaining 40 percent waits until month thirteen. On a line of credit, that untouched remainder is not idle, because the unused portion grows over time. On a fixed-rate single lump sum there is no month-thirteen draw at all, which is why fixed-rate reverse mortgages suit a payoff and rarely suit anything else.

What Comes Out Before You See the Money

The principal limit is gross, not net. Closing costs are almost always financed into the loan, which means they come out of your number rather than out of your checkbook. There are three meaningful line items.

• Initial mortgage insurance premium: 2.00 percent of the maximum claim amount. Set by Mortgagee Letter 2017-12 and charged to every borrower regardless of how much they draw. On a $750,000 home that is $15,000.
• Origination fee, capped at $6,000. Under 24 CFR 206.31 the limit is the greater of $2,500 or two percent of the first $200,000 of the maximum claim amount plus one percent of the portion above $200,000, and the total may not exceed $6,000. Any Central Oregon home worth more than about $600,000 hits the cap, so the fee stops growing with the house.
• Third-party closing costs and the counseling fee. Appraisal, title, recording, credit report, flood certification. Ordinary mortgage line items at ordinary mortgage amounts.

There is a fourth item that only applies to some files. If the financial assessment shows a history of missed property taxes or lapsed insurance, HUD may require a life expectancy set-aside, which reserves part of the principal limit to pay those charges for you. It is a protection rather than a fee, but it does reduce what is available to spend, sometimes substantially. The reverse mortgage requirements page covers when that assessment triggers a set-aside.

Ongoing, the annual mortgage insurance premium is one-half of one percent of the outstanding balance, charged on what you have actually drawn rather than on the full limit. That last detail is why an untouched line of credit costs very little to keep open.

How Much Can You Borrow on a Reverse Mortgage in Bend: A Worked Example

Take a Bend homeowner, age 70, in a home that appraises at $750,000 with no mortgage against it. At a 6.0 percent expected rate the factor is 41.5 percent, so the principal limit is $311,250.

Costs come off that. Initial mortgage insurance premium of 2 percent on $750,000 is $15,000. Origination fee at the $6,000 cap. Counseling and third-party closing costs of a few thousand more. Call mandatory obligations roughly $24,000, which leaves about $287,000 of net borrowing capacity.

Now apply the first-year rule. Sixty percent of the $311,250 principal limit is $186,750. Mandatory obligations plus 10 percent of the principal limit comes to about $55,000. The greater of the two governs, so this homeowner can access about $186,750 in the first twelve months, and the remaining $124,500 becomes available after month thirteen, growing in the meantime if it sits in a line of credit.

Change one input and watch the number move. Same house, borrower age 62 instead of 70, and the principal limit drops to $267,750. Age 80 instead, and it rises to $366,000. Take a higher-value home, say $1.6 million on Awbrey Butte with a 75-year-old owner: the calculation caps the value at $1,249,125, applies the 44.3 percent factor, and produces a principal limit near $553,000. That homeowner should also see proprietary numbers side by side, because a private product can count value above the FHA ceiling.

These are illustrations using HUD's published factors, not quotes. Your appraisal, your expected rate at case-number assignment, and your financial assessment will move all of them. The reverse mortgage calculator page explains what an online estimator can and cannot see.

How You Take the Money Changes What It Is Worth

Two borrowers with identical principal limits can end up in very different places, because the payout structure matters as much as the size of the limit.

A lump sum on a fixed rate gives you everything you are going to get at closing, subject to the first-year cap, and interest accrues on all of it from day one. A term or tenure payment converts the limit into monthly income, either for a set number of years or for as long as you live in the home. A line of credit leaves the money in place, charges interest only on what you draw, and grows the unused portion at the note rate plus the annual insurance rate.

That growth feature is the part financial planners pay attention to, and it argues against maximizing your draw simply because you can. A homeowner who takes $186,750 in year one and spends none of it has traded a growing credit line for a bank account, and paid interest for the privilege. I would rather leave it undrawn and let it compound. Reverse mortgage vs HELOC compares that structure against a conventional home equity line, and how does a reverse mortgage work covers each payout option in sequence.

When the Number Comes Back Smaller Than You Hoped

It happens, and it is worth naming the usual causes rather than leaving people to guess.

You are at the young end of eligibility, where the factors sit at their lower end. Expected rates are elevated, which compresses every factor in the table. You have a younger spouse, and HUD requires the calculation to use the age of the youngest borrower or eligible non-borrowing spouse. Your home is worth more than the FHA cap, so a large share of your equity is simply not counted. Or you carry an existing mortgage that has to be paid off first, which can consume most of the limit before anything reaches you.

Each of those has a different response. A younger spouse is a documentation question, covered in reverse mortgage age requirements. A home above the cap points toward proprietary options, including the condo route that does not need FHA project approval. A low-rate first mortgage you would rather not disturb points toward a reverse second mortgage, which leaves the first lien alone. And sometimes the honest answer is that the number does not accomplish what you need, in which case I say so. The downside of a reverse mortgage is the page I point people to when the math does not work.

Central Oregon Context for the Numbers

The formula is federal, so it does not change at the Oregon border. What changes locally is which constraint tends to bind.

Median home values in Bend sit in the mid-$700,000s, comfortably under the $1,249,125 ceiling announced in HUD's 2026 lending limit notice, so most Central Oregon homeowners are working with their full appraised value rather than a capped one. The exceptions cluster in a few neighborhoods, and they are exactly the households where running HECM and proprietary figures side by side changes the answer.

The other local factor is how many people this applies to. About 21.8 percent of Deschutes County residents are 65 or older according to U.S. Census Bureau QuickFacts, well above the national share, and a large number of them bought long before the run-up in values. That combination of age and equity is why this question comes up so often here.

I work with homeowners across Bend, Redmond, Sunriver, Sisters, La Pine, Prineville, and Madras from my office at 601 NW Harmon Blvd. The Bend reverse mortgage guide covers local equity, reverse mortgage in Oregon covers the statewide picture, what is a HECM defines the insured product, reverse mortgage rules walks each borrower obligation, reverse mortgage counseling explains the required session, and the full lineup sits on the reverse mortgage programs page. Weighing it as a family? Send the guide for adult children.

How Much Can You Borrow on a Reverse Mortgage: Frequently Asked Questions