Jumbo Reverse Mortgage: Tap Equity Above the HECM Limit

A jumbo reverse mortgage is a private, non-FHA reverse mortgage built for homes worth more than the $1,249,125 HECM limit. It is sized on your full appraised value rather than a capped one, carries no FHA mortgage insurance, and in Oregon is available from age 55. You still keep title and still owe taxes, insurance and upkeep.

The reason the product exists is a single definition in HUD's regulations. A HECM calculates what you can borrow from the lesser of your home's value or the national limit, so every dollar of value above $1,249,125 simply does not count. On a $2 million home in Bend, that means three quarters of a million dollars of your equity is invisible to the FHA program.

This page covers why that happens, how a jumbo reverse mortgage is sized differently, what it costs compared with a HECM, where the HECM still wins even on an expensive home, and which protections change when FHA insurance is no longer behind the loan. The Oregon-specific rules are at the end, because two of them apply to every reverse mortgage here and almost nobody mentions them.

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. Proprietary program terms described here come from the lenders' own published guidelines as of September 2026, are subject to change, and may be withdrawn. Nothing here is a quote or an offer.

What Is a Jumbo Reverse Mortgage?

A jumbo reverse mortgage is the everyday name for a proprietary reverse mortgage: a reverse mortgage designed, funded and priced by a private lender instead of insured by the FHA. The word "jumbo" comes from the most common reason people need one, which is a home worth more than the HECM will count, but the same products also serve borrowers aged 55 to 61 and condo owners whose building lacks FHA approval.

The basic shape is familiar. You borrow against your home's equity, no monthly principal and interest payment is required, interest and fees accrue onto the balance, and the loan is repaid when the last borrower sells, moves out or passes away. You keep the title to and ownership of your home. You remain responsible for paying property taxes, homeowners insurance, and any HOA dues; for maintaining the home; and for occupying it as your primary residence. Failure to meet these obligations may cause the loan to become due and payable.

Through Fairway I can offer two proprietary families. The Fairway Signature line is a set of proprietary products developed by Longbridge Financial, and HomeSafe is Finance of America's proprietary line. Both advertise loan amounts up to $4 million, and the Signature Peak, Signature Reverse LOC and HomeSafe Standard products each list Oregon among their approved states. None of them is part of, or affiliated with, the FHA-insured HECM program.

Why the HECM Stops Counting Your Home at $1,249,125

Every HECM starts from a number called the maximum claim amount. 24 CFR 206.3 defines it as the lesser of the appraised value, the sales price on a purchase, or the national mortgage limit for a one-family home. For case numbers assigned in 2026 that limit is $1,249,125. HUD then multiplies the maximum claim amount by a principal limit factor, which rises with the youngest borrower's age and falls as the expected interest rate climbs.

The consequence is easy to see in a table. The figures below use HUD's own published factor for a 70-year-old at a 6.00 percent expected rate, which is 41.5 percent.

Past the limit, the HECM number freezes. A 70-year-old with a $3 million home gets exactly the same principal limit as a 70-year-old with a $1.25 million home. Age still moves it: on any home above the limit, the same 6.00 percent factors put the HECM principal limit at $445,938 for a youngest borrower of 62, $609,573 at 80 and $771,959 at 90. The home value no longer does.

Keep in mind that a principal limit is not cash in hand. Financed closing costs and any existing mortgage come out of it first, and a HECM also restricts how much you can take in the first year. How much you can borrow on a reverse mortgage walks through all of those deductions on a Bend example.

How a Jumbo Reverse Mortgage Is Sized Instead

A jumbo reverse mortgage uses the same basic ingredients, age, rate and home value, but applies the lender's own factor table to your full appraised value. There is no national cap, only the program's maximum loan amount, which is $4 million on the products above, with a lower $2 million ceiling in Massachusetts.

Three differences matter when you read a proprietary quote:

• The factor table belongs to the lender. HUD publishes one table that every HECM lender uses. A proprietary lender sets its own and can change it. Longbridge's published terms for its Platinum program state plainly that it may change the factor tables used for the loan at any time. That is why I will not print a proprietary factor on this page. The only honest proprietary number is a quote run on the day you ask.
• Minimum values and credit floors apply. The Fairway programs list a $200,000 minimum property value for HomeSafe Standard, $300,000 for Signature Peak and $450,000 for the Signature Reverse LOC. Minimum credit scores run 550 on the Signature products and 600 on HomeSafe Standard.
• The age floor is 55 in Oregon. Each program sets higher floors in a handful of states, such as 60 in Massachusetts and 62 in Texas, but Oregon is not among them. For a borrower between 55 and 61, a jumbo reverse mortgage is the only reverse product available at all. Reverse mortgage age requirements covers how the age floors work across product types.

So on the $2 million home in the table, a jumbo reverse mortgage is sized on $2 million instead of $1,249,125. For many borrowers the proprietary figure comes back meaningfully larger. How much larger depends on the lender's table, your age and the rate that day, and on a home only modestly above the limit the gap can be small enough that the HECM still comes out ahead.

Jumbo Reverse Mortgage vs HECM: Side by Side

Here is the whole comparison on one screen. The proprietary column describes the Fairway Signature and HomeSafe products as their lenders publish them today, and individual products within each family differ.

If your home is a condominium, the condo row is often the deciding one on its own. A reverse mortgage on a condo without FHA approval covers that case in detail.

What Does a Jumbo Reverse Mortgage Cost Compared With a HECM?

The cost comparison cuts both ways, which is why it deserves more care than a headline.

What you skip. A HECM charges an initial mortgage insurance premium of 2.00 percent of the maximum claim amount. On any home at or above the limit, that is 2.00 percent of $1,249,125, or $24,982.50, whether or not you ever draw a dollar. Add the HECM origination fee, which HUD caps at $6,000, and the two FHA-side charges alone reach $30,982.50 before appraisal, title and recording. The annual premium of 0.50 percent of the balance then accrues for the life of the loan; on a $400,000 balance that is $2,000 a year added to what you owe. A jumbo reverse mortgage has no mortgage insurance at all.

What you pay instead. The lender prices the missing insurance into the loan. Fairway's own product disclosures say proprietary interest rates may be higher than comparable HECM rates, and the product built to produce the largest lump sum carries a higher fixed rate than the rest of its family. Origination on a proprietary loan is set by the lender rather than by HUD's cap.

The cost almost nobody mentions. Most jumbo reverse mortgages are fixed-rate, single lump-sum loans, and some require you to take most of the money at closing. Signature Peak generally requires a minimum initial draw of 80 percent of the available amount. Interest accrues on every dollar from day one, so borrowing $900,000 you do not yet need is expensive even at a reasonable rate. If what you actually want is a reserve, the size of the lump sum is the wrong thing to optimize.

The fairest way to compare the two is the disclosure federal law already requires. Under 12 CFR 1026.33, every reverse mortgage, HECM or proprietary, must come with a table of total annual loan cost rates projected at 0, 4 and 8 percent annual appreciation, over a two-year period, your life expectancy, and 1.4 times your life expectancy. It must reach you at least three business days before closing. Ask for that table on both loans and lay them next to each other. It folds the mortgage insurance, the rate and the fees into one comparable figure, which a rate quote alone never does.

Rate pricing on the proprietary side has enough moving parts to deserve its own explanation, and jumbo rates will get one. For now, the point is simply that "no mortgage insurance" and "cheaper" are not the same claim.

Where the HECM Still Wins on an Expensive Home

A jumbo reverse mortgage is not automatically the right answer just because a home is worth more than the limit. The HECM keeps two real advantages.

The line of credit. On an adjustable-rate HECM, the unused line of credit grows every month at the loan's interest rate plus the 0.50 percent annual mortgage insurance rate, for as long as the loan is open. There is no draw period that ends. The proprietary line of credit products I can offer grow the unused line by 1.5 percent a year for the first seven years, within a 10-year draw period, and Fairway's own disclosure notes that the growth feature may be less robust than a HECM's. For someone who wants a standby reserve for a long retirement, that difference compounds. Reverse mortgage line of credit growth shows the HECM arithmetic year by year, and the standby reverse mortgage strategy explains why planners care about it.

The home just above the limit. If your home appraises at $1.3 or $1.4 million, the HECM ignores only a small slice of it, and the HECM's pricing can make up for that slice. Run both before assuming the proprietary loan wins.

The cases where a jumbo reverse mortgage usually does earn its place:

• Your home is well above the limit and you want a large lump sum now, for example to retire a sizable existing mortgage and end the monthly payment.
• You are between 55 and 61, so a HECM is not yet available.
• Your condominium lacks FHA approval and cannot practically get it.
• You are buying a higher-priced home. The Fairway proprietary products can be used to purchase, with eligible seller concessions of up to 6 percent. HECM for Purchase covers the FHA version of the same idea, and it tops out at the same $1,249,125 limit.

And one case where neither fits: if you have a very low first mortgage rate you would rather keep, both a HECM and a standard jumbo reverse mortgage must pay it off. The reverse second mortgage is the proprietary tool built to sit behind it instead.

Which Protections Change on a Jumbo Reverse Mortgage?

This is the section to read slowly. A HECM's protections come from federal law. A jumbo reverse mortgage keeps some of them, keeps others only by contract, and loses one entirely.

• Non-recourse carries over. The proprietary programs I work with are non-recourse: you or your heirs will never owe more than the home is worth when the loan becomes due. On a HECM that promise is backed by FHA insurance. On a jumbo reverse mortgage it comes from the loan contract. It also has legal teeth in two places. Regulation Z defines a reverse mortgage transaction as a nonrecourse consumer credit obligation, and Oregon's mortgage lending statute, ORS 86A.195, exempts a reverse mortgage from its negative-amortization restrictions only if the loan is non-recourse and made by a licensed lender. Confirm the non-recourse language in your own loan documents anyway.
• The federal payment backstop does not carry over. For a HECM, 12 U.S.C. 1715z-20(i) directs HUD to take any action necessary to provide the borrower with funds they are entitled to but have not received because the party responsible for paying them defaulted. That is the section that stands behind a HECM line of credit and monthly payments if the lender cannot pay them. No equivalent federal protection stands behind a proprietary line of credit. That matters very little on a lump sum you receive at closing and quite a lot on a line you plan to draw for a decade.
• Counseling comes from a different source. Federal law requires a HECM borrower to complete counseling with a HUD-approved counselor before applying. On a proprietary loan the requirement comes from the lender's program and state law rather than from FHA, so confirm it is part of the process. I recommend the independent session either way. Reverse mortgage counseling explains what it covers.
• The rulebook is the lender's. Factor tables, minimum values, eligible properties and even which states are served can change at the lender's discretion. HUD's HECM rules change too, but through published mortgagee letters and regulations.

None of that makes a jumbo reverse mortgage unsafe. It makes it a private contract that deserves a private-contract level of reading. If a lender is vague about any of these points, that vagueness is information, and reverse mortgage scams and red flags covers what else to watch for.

Two Oregon Rules That Apply to Every Jumbo Reverse Mortgage

You give up Oregon's senior property tax deferral. Under ORS 311.700(2), a homestead pledged as security for a reverse mortgage is not eligible for the state's senior and disabled property tax deferral program. The statute does not distinguish HECM from proprietary. The only exception covers reverse mortgage contracts executed between July 1, 2011 and January 1, 2017 where the owner holds at least 40 percent equity. If you currently defer your property taxes, or planned to, that has to be part of the math.

Your lender must tell you so in writing. ORS 86A.196(1) requires a lender to give you written notice of that deferral rule before you enter into a reverse mortgage. The same section requires most reverse mortgage lenders to send an annual reminder about property taxes and insurance at least 60 days before property taxes are due, unless your loan includes a reserve account for taxes.

Oregon law also spells out what a reverse mortgage summary must say. Here it is, plainly:

A Jumbo Reverse Mortgage in Bend and Central Oregon

The HECM limit is a national number, and in Central Oregon it lands right in the middle of the upper market. Zillow's home value index put the typical Bend home at $732,894 in July 2026, comfortably below the limit. Its top-tier index, which tracks homes between roughly the 65th and 95th percentile of values, put Bend at $1,184,497, just under it, and Sisters at $1,252,657, just over it.

The west side is where the limit bites. In the 97703 ZIP code, which takes in Awbrey Butte and NorthWest Crossing, Zillow put the typical home at $1,014,797 and the top tier at $1,482,331. That puts a large share of west-side owners either near the ceiling or well past it, which is exactly where the HECM table above starts leaving equity uncounted. Down south, the September 2026 Beacon Report put the August median single family sale in Sunriver at $973,000. Source data for the Zillow figures is on Zillow's research data page.

One local caution. Those same Zillow indexes were lower than in July 2025, by 1.3 percent for the typical Bend home and 3.9 percent for the Sisters top tier, and Beacon puts Sunriver and Sisters at five and a half months of inventory. A jumbo reverse mortgage is sized on the appraisal, not on what a neighbor listed for, so a softer market can move the number. I would rather you hear that before the appraisal than after.

For the wider local picture, the Bend reverse mortgage guide and reverse mortgage in Oregon cover the rest, and the reverse mortgage programs page shows where jumbo and proprietary options sit alongside the HECM.

Jumbo Reverse Mortgage: Frequently Asked Questions