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FHA Announces $417,000 Reverse Mortgage Loan Limit
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Bob Davis
STORY TOOLS 
More from YourNews BusinessFHA Commissioner Brian Montgomery announced today that the new HECM, Home Equity Conversion Mortgage, nationwide loan limit will be $417,000. The target effective date is November 1. This is a target date right now, not a set deadline.
There was significant debate within HUD to consider area limits at 115% of area median home value, with a floor of $417,000 and a cieling of $625,500. Ultimately, the interpretation was determined that the new legislation will be a $417,000 loan limit. This was the original limit embraced by the the reverse mortgage industry.
A more liberal interpretation of HR 3221 considered a maximum loan limit to $625,500 in high cost areas, such as Ventura county. The complexity of the bills language created much debate and ultimately the final decsion of the $417,000 loan limit.
A majority of counties nationwide have lending limits at the existing loan limit of $200,162 which has drastically reduced the amount of equity that seniors living in higher-valued homes could access. These new limits will have a significant impact on the quality of life and provide more relief to those seniors who need the help especially in todays turbulent economic environment.
These are all positive developments for the reverse mortgage industry and the older Americans served. As HUD moves toward the implementation of the many other important aspects of the housing bill including the ability to purchase a home using a reverse mortgage the consumer will be able to look forward to additional developments in the near future.
Contact Senior Advantage Reverse Mortgage and The Bob Davis Team for further details and a free booklet titled, Reverse Mortgage, Fact or Fiction? (805) 658-7435 or senioradvantage@firstmortgage.com.
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