||February 14th, 2008|
Reverse Mortgages . . .
with Laura Strickler
Laura Strickler -
Your Reverse Mortgage Specialist
Reverse Mortgages... With Laura Strickler
I just received a call from a former client. She was wondering why I hadn't notified her of the new lending limits available for reverse mortgages. When I asked her what prompted her call, she told me she had received a solicitation in the mail alerting her to the new reverse mortgage lending limit of $729,750. She read the letter to me and again asked me why I hadn't called her. "Because it's not true," was my reply.
Here is where experience counts. I could be sending out misleading mailers like many of my competitors. I don't. I don't because I know the importance of waiting to know the facts. I was going to write a column on the "changes" last week, but waited because I couldn't verify the facts prior to the deadline.
Let me explain exactly what has taken place. I am relaying this information to you from an e-mail received from Peter Bell, President of the National Reverse Mortgage Lenders Association (NRMLA). Mr. Bell is as involved as anyone can be in the reverse mortgage industry.
Last week, Congress passed the Economic Stimulus bill, HR 5140, which includes, in part, a temporary increase in loan limits for Fannie Mae, Freddie Mac and FHA to 125% of area median home prices, or a maximum of $729,750 (for the remainder of this year only). The bill should be signed into law sometime this week by the President. Here's the important part: The bill specifically excludes HECM (reverse mortgages) from the new temporary FHA loan limits. The reason? There are a few members of the Senate who are vociferously opposed to expansion of the HECM program. In particular, Sen. Tom Coburn, R-Oklahoma. He believes that FHA will crowd- out other private sector reverse mortgages. Coburn feels that Congress should wait for the GAO (Government Accountability Office) report on the HECM program called for in the FHA Modernization Bill. Sen. Coburn could have slowed down the stimulus package if it included increased HECM lending limits, so a decision was made to exclude Sec. 255 (the section of the US Housing Act authorizing HECMs) from the stimulus package.
That leaves us all still waiting for the FHA Modernization Bill to provide us with a single national loan limit and other HECM provisions that will allow home purchase and other property provisions.
The point of this article is to keep you informed, but more importantly to keep you from working with people who don't take the time to verify their information prior to disseminating it to the public. Keep in mind, my client received this solicitation in the mail either Monday, February 11th or late the previous week. This bill had not been signed by the President as of Monday, February 11, 2008, at 8:30 AM. By the time The Paper is delivered, the bill may well have been signed. Even with that said, the information is not accurate as it pertains to HECM reverse mortgages.
As always, I'm here to answer your questions. And if you decide a reverse mortgage is right for you, I am your local expert. Experience counts, call me.
Laura Strickler, CSA
Certified Senior Advisor
Reverse Mortgage Specialist
760-518-9839 / 800-491-2374
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