Types of Reverse Mortgages - HECM Changes as of September 30, 2013
The U.S. Department of Housing and Urban Development, HUD, raised the national FHA Reverse Mortgage lending limit to $679,650 through the lobbying efforts of AARP and NRMLA, National Reverse Mortgage Lenders Association. Currently, this max lending limit is still in place, thereby helping more homeowners to obtain a Reverse Mortgage.
Federally Insured Reverse Mortgages: The Federal Housing Administration (FHA) insures the FHA HECM product. Because of the increased lending limit to $679,650, the HECM can now accomodate higher value homes thereby giving relief to homeowners with sizeable mortgage balances. If there is enough equity in your home, current mortgage balances can be paid off with the Reverse Mortgage.
About Fixed Rates: With a fixed rate Reverse Mortgage, you are required to take all the proceeds at closing and cannot draw any monies thereafter. Some borrowers choose the fixed rate product because they are more comfortable with fixed rate products. However, many borrowers are attracted to the flexibility of the FHA LIBOR option where you can set up a line of credit, monthly proceeds, cash out or a combination of all three. In the final analysis, it's about what you plan on doing with your money.
The Reverse Mortgage is a fantastic program for any senior homeowner who wishes to access the equity in their home. HECM counseling is still required, so ask your Reverse Mortgage specialist, Kathie Adler, to provide you with a list of counselors or access them from http://www.Hud.gov.
Reverse Mortgage Counseling Required: Reverse Mortgages require federally mandated Reverse Mortgage counseling from an independent HUD approved counselor. Counseling is required prior to your appraisal and title being ordered.
Free Reverse Mortgage information, call 1-888-843-9797