Reverse Mortgages Expected Interest Rates Lower

Mortgagee Letter 2010-34

Some borrowers can now expect to receive more money from their reverse mortgages. The Department of Housing and Urban Development (HUD) announced Mortgagee Letter 2010-34 that makes some substantial changes to the reverse mortgage (HECM) program, including lower expected interest rates. While the mortgagee letter was widely anticipated as a formal announcement of further reductions in reverse mortgages loan amounts (PLF), an unexpected addition to the rule resulted in lower expected interest rates. For some younger borrowers, the lower rates will yield higher loan amounts and therefore, more loan proceeds to pay off existing mortgages which could result in more applicants qualifying for the HECM. While the dust settles, existing reverse mortgage applicants should stand by to see what outcome the effects of this new mortgagee letter will have on current applications in process.

This exactly the kind of creativity we need to help more Americans get home equity loans, like reverse mortgages. I see it as a welcome, positive sign emerging in an industry that has been crippled by regulation, reduction and reputation. For a new reverse mortgage quote with lower expected interest rates, call me directly.

Michael Manfredi is a reverse mortgage specialist in Phoenix, Arizona.

Reverse Mortgage Concepts
Phoenix, AZ 85020
(602) 456-0009
(888) 697-5556