In June 2014, the U.S. Department of Housing and Urban Development (HUD) released a letter announcing new changes to the Home Equity Conversion Mortgage (HECM) program, specifically regarding reverse mortgage borrowers with non-borrowing spouses.
Effective August 4, 2014, new Principal Limit Factors will be in place for the HECM, which will allow borrowers with spouses under the age of 62 to still qualify for a reverse mortgage. This may give borrowers access to higher loan amounts than they would have had access to in the past.
Prior to this change, married couples with a spouse under the age of 62 on title to the property would not qualify for the HECM program.
With these new Principal Limit Factors in place, senior borrowers with a spouse under the age of 62 who did not necessarily qualify before may now be able to qualify. In addition, younger spouses will be able to remain in their residence for as long as they wish as long as they qualify per HUD guidelines, remain current on their taxes and insurance, and otherwise comply with the loan terms.
Call American Advisors Group at 1-888-998-3147 and talk to your Reverse Mortgage Professional to find out how much cash you and your younger non-borrowing spouse may now be eligible to receive.
“Mortgagee Letter 2014-12 – HECM Program: New Principal Limit Factors.” Portal.HUD.Gov. U.S. Department of Housing and Urban Development. 27 June 2014. Web. 6 August 2014. http://portal.hud.gov/hudportal/documents/huddoc?id=14-12ml.pdf