Sometimes it’s a challenge for me to keep up with what’s going in in the Reverse loan industry because there have been so many changes and developments over the last year. I’m not always on top of writing regularly in this site, due to my frantic schedule but I would like to share some new information today.
Currently the HUD lending limit for the nation is $625,500 but there is some discussion to reduce that amount to the previous figure of $417,000 due to the continual decline in property values, etc. If you have a home that is valued above 417K and you’ve been “thinking’ about doing the loan, now is the time to move forward before it’s too late to get the larger amount of funds.
Other news concerns the possibility that HUD may offer a slightly different Home Equity Conversion Mortgage, otherwise known as HECM…to be considered a “mini” version of the standard loan.
At this time there is very little information as to how this product would benefit the senior population, as it is still under development. But it sounds to me that it might be a Fixed rate however the borrower would receive less money and HUD does have some concerns that it could set off a potential refinance climate and possibly result in “churning” which is never good for investors.
Another topic concerns property taxes. Many seniors are finding themselves unable to pay their property taxes because they lack the income to do so. The result is they are losing thier homes due to back taxes and are being forced out of their residences.
If they are able to acquire a Reverse mortgage, they will have the funds to pay the taxes and keep their home from going to auction, plus….if they are in foreclosure proceedings; they can also use funds from a Reverse loan to pay off the existing loan and all the fees associated with the foreclosure process and keep their home.
Just a few tidbits of information and good news, something that we all need.