The new FHA insured reverse mortgage (HECM) now has a single national loan limit of $417,000.    The new lending limit will have a dramatic and positive impact on senior homeowners who currently own homes with a value that is higher than the FHA County Lending limits previously in effect.  The senior homeowners who fit this profile will receive a greater release of equity that may be needed to pay off a current mortgage or simply meet their financial needs.

Concurrent with the FHA’s introduction of the new lending limits is the implementation of the revised method for calculating the ORIGINATION FEE.  The origination fee will be based on 2% of the first $200,000 of home value, plus 1% of any additional value up to $417,000; with a maximum origination fee of $6,000.00.

If you currently have a reverse mortgage in process at the lower FHA country lending limit or your origination fee is over $6,000.00 please contact your lender immediately for a revised estimate.

As always, if you have any questions, feel free to contact me at 720.641.3482 or bartonkaren@comcast.net

The Senate recently passed HR 3221 and the President signed the bill into law effective immediately.

Once HUD issues a Mortgagee Letter, we are hoping to see the current lending limit of FHA per county to go to $417,000 and higher for high cost areas.

In addition to the higher loan amount, we are excited about a HECM for purchase product. This will allow seniors to purchase a home with a reverse mortgage.

Reduced origination fees of 2% on the initial $200,000 of maximum claim amount and 1% on the balance thereafter with a cap of $6,000.

More protection to the senior with prohibitions on requiring the purchase of annuities and other financial products, along with restrictions around cross selling of financial products.

Many feel the FHA HECM product will take approximately 60 -90 days to implement.

This is good news for the industry and for our senior population. As always, if you have any questions, please don’t hesitate to contact me.

720.641.3482

Three weeks ago I met with Marcia and who was at her wit’s end. A few years back she found out her daughter and two grandchildren were in an abusive situation. Having a heart of gold, she offered to have them move in with her until the the situation was resolved.

It’s been difficult for her daughter to find solid, stable work in this tough economy so, once again, Marcia was there financially to support them. She had to take on a part time job herself to try and make ends meet. With the rising cost of food, gas, utilities and the cost of living — she was just going deeper and deeper in debt. It was spiraling out of control and Marcia was panicking.

Marcia, in desperation, decided to look into a reverse mortgage. The numbers showed that Marcia could pay off her current mortgage, obtain $5,000.00 to pay off some bills and have another $43,000.00 available in a line of credit for emergencies down the road.

Her concern was could she qualify? When she learned that she did not need good credit to qualify, it was the answer to her prayers.

She completed her counseling, went to application, the appraisal was performed and she closed her reverse mortgage in less than three weeks. Marcia was so relieved to have this behind her. She kept saying “you don’t know what a burden this is off my shoulder.” I can now focus on helping my daughter get her life established and get back to my retirement…”you just don’t know how relieved I am.”

I was so delighted to help Marcia get her finances and life back in order that it really made me feel happy too — that I was a part of getting this family back on track … priceless!

720.641.3482