The Federal Housing Administration is increasing its maximum claim amount for reverse mortgages in the coming year, according to HousingWire.
This is the fourth consecutive year of an increase to the Home Equity Conversion Mortgage (HECM), a program that enables homeowners over the age of 62 to extract equity from their home without incurring monthly payments. These loans are made by private lenders and insured by the federal government. This safeguard protects borrowers, ensuring that they will not owe more than what their property is worth.
So long as the property owners make payments on taxes and insurance, and keep it in good shape, they may stay in the home as their primary residence for as long as they like.
The new limit for 2020 is $765,600, a nearly $40,000 increase from the previous year. The increased level also means this loan is open to more buyers, who may have not been able to qualify due to the amount of the remaining balance on their mortgage loans.
If you live in the Roseville area, this is terrific news because it may provide greater flexibility to make the most of your investment. So if you’re ready to convert your equity into cash and keep the home you’re in, please contact us today to learn more about your options.