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a. Maximum Mortgage Amounts (04/29/2024)
A maximum mortgage amount is not required to be stated in the Mortgage. However, where state law requires the Mortgage to reflect a maximum mortgage amount, the Mortgagee must use an amount that is at least equal to 150 percent of the Maximum Claim Amount (MCA).
The Mortgagee may not disburse payments which will cause the outstanding loan balance to exceed the maximum mortgage amount stated in the Mortgage after the payment is disbursed. If the outstanding mortgage balance reaches the maximum mortgage amount, payments to the Borrower would cease. Payments may be reinstated only in the event the Borrower executes a modification to the Mortgage.
For each HECM FHA insures, the Mortgagee must fully comply with the following requirements.
i. National Housing Act’s Statutory Limits
The National Housing Act establishes the national mortgage limit for HECMs.
ii. Nationwide Mortgage Limits
The national mortgage limit for HECMs is governed by the maximum claim amount limitation in sections 255(g) and 255(m) of the National Housing Act, which contains cross-references to section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act. FHA publishes updated limits effective for each calendar year.