HUD Lending Limits

FHA reverse loans are under the umbrella of HUD and recently they increased the amount of funds a senior may receive from a it and this is very good news as having additional funds for many seniors can make a substantial increase in the quality of their life and financial peace of mind.

Effective in January 2020 the Lending Limit will increase to $765,600.  For 2019 it has been $726,525 and the previous year in 2018 it was $679,650.   And what does this mean to a senior who applies for a reverse loan?

Increased access to their equity and along with the higher property values here in California, it might mean paying off a large loan balance a homeowner has now and eliminating the burden of mortgage payments.

If a senior already has a reverse loan, this will not be retroactive for them.  But if their loan is at least 18 months old, they could possibly refinance it and take advantage of the higher Lending Limit.

And in addition to possibly a lower interest rate and more funds, they would be entitled to a credit on the MIP/Mortgage Insurance Premium they paid at the time their loan was originated.

For anyone who previously investigated doing a reverse loan but was unable to qualify for it due to lack of equity or a high loan balance, might be able to do it in 2020.  And it certainly would be worth a few minutes of time to investigate it and find out if it is an option for one, or not.

 

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