• A HUD limit increase, inflation and low rates have spurred new interest.
• Those on fixed income are more likely than ever to consider the benefits of a reverse mortgage.
• Current low interest rates for a reverse mortgage make it easier to qualify.
Effective January 1, 2022, HUD increased the allowed loan limit for reverse mortgages to a new high of $970,800. This welcome change comes amid growing concern among seniors (age 62 and older) that the rate of inflation will continue to grow, at least for the remainder of this year.
“This new increase is a huge step ahead to help qualify more seniors on reverse mortgages in high-cost areas where loan balances are higher and baby boomers are retiring in huge numbers.”
When interest rates were higher in the past, those seniors on fixed income might have been concerned about whether they could qualify for a reverse mortgage. As long as prevailing rates remain low, it's expected that more and more seniors will see the advantage of making the move quickly before they start to rise again. They're especially inclined now to see that one significant benefit of a reverse mortgage is the opportunity for them to significantly reduce their monthly expenses and enjoy a better quality of life.
For more information:
https://www.hud.gov/press/press_releases_media_advisories/hud_no_21_197
https://www.nrmlaonline.org/2021/12/01/hecm-loan-limit-increased-to-970800-in-2022
