Jumbo Reverse Mortgage Calculator

Jumbo (Proprietary) vs. FHA HECM: How the Two Reverse Mortgage Types Compare

The two products solve the same basic problem — converting home equity into cash without a monthly payment — through very different structures. The table below summarizes the differences that matter most, though exact terms always depend on the specific lender, since proprietary loans aren't standardized by a federal agency the way HECM loans are.

Who Actually Needs a Jumbo Reverse Mortgage

Jumbo reverse mortgages make sense for a specific slice of homeowners: those who are otherwise strong candidates for a reverse mortgage — 62 or older (or close to it), equity-rich, wanting to avoid a new monthly payment — but whose home value is high enough that a standard HECM would leave real equity on the table. A retired couple in a $2.4 million home, for example, would have a standard HECM's principal limit calculated as though the home were worth $1,249,125, regardless of the extra $1.15 million in value sitting in the property. A proprietary lender can underwrite against the full $2.4 million instead, which can translate into a meaningfully larger amount of usable proceeds, even after accounting for a jumbo product's typically higher rate.

Financial advisors and estate planners tend to recommend exploring a jumbo product when a client's home value clears the FHA limit by a wide enough margin that the gap in borrowing power is material — not simply because the home happens to be worth a little more than $1,249,125. For homes only modestly above the limit, the standard HECM's FHA insurance, standardized counseling requirement, and guaranteed non-recourse protection can still make it the safer, better-understood choice.

Qualifying for a jumbo product looks similar to qualifying for a HECM on the surface — both involve a review of income, credit history, and property-charge history meant to confirm the borrower can keep up with taxes and insurance for as long as the loan is outstanding. The difference is who sets the bar: HECM lenders follow one standardized HUD financial assessment, while jumbo lenders each set their own, typically somewhat stricter, credit and income thresholds since they're carrying the full risk of the loan themselves. Neither product requires the kind of credit-score cutoff a forward mortgage does, but a jumbo applicant with a thin or troubled credit history may find a proprietary lender less forgiving than a HECM's federally standardized review.

Worked Example: A $2,000,000 Home Under HECM Rules

Here is what the calculator returns with the values it opens with: a $2,000,000 home, a youngest borrower aged 70, a 6.5% expected rate (an example, not a quote), a $50,000 mortgage to pay off and $3,000 of other closing costs. The maximum claim amount is capped at $1,249,125, so $750,875 of the home's value is ignored. HUD's principal limit factor for age 70 at the 6.5% row is 0.392, giving a principal limit of $489,657. Take away $24,983 of upfront mortgage insurance (2% of $1,249,125), the $6,000 maximum origination fee, the $3,000 of other costs and the $50,000 payoff, and $405,675 is left. On an adjustable-rate HECM that is up to $209,812 in the first year, a line of credit of $405,675 if nothing is drawn, about $2,683 a month for life, or about $4,683 a month for 10 years.

Now change the home value to $1,249,125, or to $3,000,000. Every one of those figures stays the same, because a HECM never looks past the limit. That is the whole case for a jumbo reverse mortgage in one test: if a proprietary lender's quote on your home doesn't beat the HECM figure the calculator shows, the value above the limit isn't buying you anything. With no further draws and a constant rate, the projection table shows the $83,983 starting balance (the payoff plus financed costs) growing at 7% a year to $168,776 after 10 years, while the unused line grows at the same rate to $815,268.

How Jumbo Reverse Mortgage Proceeds Can Be Paid Out

For years, jumbo reverse mortgages were lump-sum-only products — you took the full available amount at closing, usually at a fixed rate, and that was the extent of it. That has loosened somewhat: a growing number of proprietary lenders now offer a line of credit or monthly-payment option alongside the lump sum, similar to how HECM borrowers have long been able to choose their disbursement method. Coverage still isn't universal, though, so if a line of credit specifically matters to you, plan to shop lenders rather than assume every jumbo program offers one.

There's a subtler difference worth knowing if you do find a jumbo line of credit. On a HECM, the unused portion of a line of credit is guaranteed to keep growing and to remain available under a federally backed program. On a proprietary loan, that same growing, available credit line is a commitment from the individual lender rather than a government guarantee, so it's worth asking directly how the lender documents and honors that availability over the life of the loan — particularly since the line of credit the calculator above shows follows HECM rules, not any proprietary lender's.

Risks and Considerations With Proprietary Reverse Mortgages

A jumbo reverse mortgage trades FHA standardization for flexibility, and that trade brings real risks worth weighing before choosing one over a standard HECM:

• Non-recourse protection isn't federally guaranteed.Many proprietary lenders build non-recourse terms into their jumbo products voluntarily, but because there's no FHA insurance pool behind the loan, that protection lives in the individual lender's contract rather than in federal law. Read the loan documents closely, and don't assume it applies just because it's standard on HECM loans.
• Terms vary far more by lender.Interest rates, principal-limit factors, closing costs, and even minimum age can differ meaningfully from one proprietary lender to the next, since there's no single federal program setting the baseline the way HUD does for HECM.
• Rates tend to run higher. Because the lender bears the full risk of the loan without FHA insurance absorbing a shortfall, jumbo reverse mortgage rates are often somewhat higher than HECM rates, which accelerates balance growth even before accounting for the MIP difference shown above.
• Fewer standardized consumer protections. HECM borrowers get a federally mandated counseling requirement, standardized disclosures, and FHA oversight. Jumbo borrowers get whatever protections their specific lender chooses to offer, though many still voluntarily provide counseling and clear disclosures as a matter of practice.
• Fewer lenders to compare. Far fewer lenders offer proprietary jumbo products than offer HECM loans, which can mean less competitive pressure on pricing — all the more reason to get quotes from more than one lender before committing.
• Payout options are less standardized.As covered above, not every jumbo lender offers a line of credit or monthly-payment option the way HECM programs do, and where a line of credit is offered, its guaranteed growth and availability rest on the individual lender's commitment rather than a federal program.
• Underwriting can be stricter.HECM lenders follow HUD's standardized financial assessment, reviewing income, credit history, and property charge history to confirm a borrower can keep up with taxes and insurance. Jumbo lenders run a similar review, but because there's no government backstop absorbing their risk, they often apply somewhat stricter, lender-specific credit and income standards on top of it.

Jumbo Reverse Mortgages vs. Cash-Out Refinancing or a HELOC on a High-Value Home

A high-value homeowner weighing a jumbo reverse mortgage usually has other equity-access options on the table too. A cash-out refinance or a HELOC — see our refinance amortization calculator for that math — requires a monthly payment and typically a credit and income check, with a balance that shrinks over time instead of growing. A jumbo reverse mortgage requires no monthly payment and is qualified primarily on age, equity, and the ability to keep up with property taxes and insurance, but the balance grows rather than shrinks, as the projection in the worked example above shows. Which is better depends on whether a new monthly payment is comfortable and how long the homeowner plans to stay in the home.

It's also worth remembering what happens at the other end of a jumbo loan: when it comes due, heirs typically repay it and keep the home — often by refinancing into a conventional loan like the ones modeled on our 30-year mortgage amortization schedule page — sell the home and keep any proceeds above the payoff balance, or, where the loan is genuinely non-recourse, walk away without personal liability for a shortfall. Because that non-recourse outcome isn't federally guaranteed on proprietary loans the way it is on HECM, confirming exactly how the specific lender's contract handles a shortfall matters more here than it does with a standard HECM.

Methodology and Sources

The calculator above is the same one used on our standard reverse mortgage calculator: it looks up HUD's principal limit factor for the youngest borrower's age and the expected rate (rounded down to the table's nearest 1/8-point row), applies it to the lesser of the home's value and the FHA limit, deducts the 2% upfront mortgage insurance, the origination fee (the federal cap unless you enter a lower one), your other closing costs and any mortgage payoff, and projects the balance and unused line at the expected rate plus 0.5% a year. It reports the value above the limit separately. It does not estimate a proprietary loan, because proprietary lenders don't publish their factors. The 2026 FHA HECM lending limitThe 2026 FHA HECM lending limit of $1,249,125 comes directly from HUD's 2026 loan limit announcement, and the description of proprietary reverse mortgages as privately funded, non-FHA-insured products for higher-value homes is confirmed by the Consumer Financial Protection Bureau. For the math behind every forward-amortizing loan on this site, see our standard amortization methodology page.