Jumbo Reverse Mortgage
The Reverse Mortgage we do over 90% of the time
is the FHA/HUD version.
One of the limitations is that it ignores any value of a home valued
more than $679,650. So,
if your home is worth, say $1,000,000, over $300,000 of that value
is not considered in the calculation of how much you receive.
For the past few years, we’ve had access to a
single proprietary (non-FHA loan from a Top 10 lender) Reverse
Mortgage that would look at the full value of your home.
But they were not very attractive.
The home value needed to be near $2,000,000 before they began
having more money available than the FHA version.
Well,
that has changed. We
now have four lenders doing this type of loan.
Because of this, the terms have been significantly more
attractive. Now, I start
looking to see if there is more money available, as compared to the
FHA version, at an estimated home value of about $800,000.
That doesn’t automatically mean there is more
money available. It will
depend on how much the borrower owes and the age of the youngest
borrower.
Also, the FHA version has a high upfront cost.
For a home valued over $600,000, the MIP (Mortgage Insurance
Premium required of FHA Reverse Mortgage loans) is over $12,000 with
an origination fee typically up to $6,000 plus closing costs.
Most of the ‘Jumbo’s’ I use have no MIP, no origination fee
and only third-party closing costs.
This is written in November 2018.
We are told to expect many more improvements to the Jumbo
Reverse Mortgage.
If this looks attractive to you, give me a call
and I can work out the numbers for your specific details.
