The maximum loan amount for a retirement savings housing loan in the United States varies by program and borrower qualifications. For instance, reverse mortgages under the Federal Housing Administration (FHA) HECM program allow homeowners aged 62+ to borrow up to $9.92 million in 2023, based on the home’s appraised value and the borrower’s age. Conversely, loans leveraging retirement accounts like 401(k)s or IRAs typically permit withdrawals of up to 60% of the account balance, subject to penalties for early withdrawals unless the borrower meets IRS criteria for hardship or first-time homebuyers. State-specific programs, such as New York’s Reverse Mortgage Program, may cap loans at $1 million regardless of account size.

The disparity in loan limits stems from program design and regulatory constraints. HECM loans are government-insured, allowing lenders to offer higher amounts due to FHA guarantees, while retirement account loans prioritize preserving funds for future withdrawals. IRS rules restrict early withdrawals from tax-advantaged accounts unless used for qualified expenses, such as a primary residence, but penalties (10% for IRAs/401(k)s) apply unless the borrower is 59½ or older. Data from the National Reverse Mortgage Lenders Association (NRMLA) shows 78% of HECM borrowers in 2022 tapped less than $500,000, reflecting cautious borrowing despite higher limits. State programs like California’s Homeowner Assistance Program cap loans at $400,000, emphasizing regional affordability priorities. Ultimately, maximum amounts balance risk mitigation for lenders, regulatory safeguards, and borrower financial stability.