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FHA plans to modify its HECM product

Shared by Niicss on Sat Aug 28, 2010 2:50 am
Hello Everyone, The Federal Housing Administration (FHA) announced that it plans to make modifications to its Home Equity Conversion Mortgage (HECM) product in order to make it attractive and cost effective to the senior citizens. HECM is a FHA insured reverse mortgage loan. FHA is planning to implement a new variant of HECM which will be known as "HECM Saver". It will provide seniors with a reverse mortgage option with low upfront costs. The upfront costs will be lowered by eliminating the upfront Mortgage Insurance Premium that is required under the standard HECM option. Source: http://www.disabled-world.com/disability/finance/hud-mortgages.php

Community Members Opinion

jerry

Joined: 17 Oct 2005

Moderator
Posts: 2708
Location: MICHIGAN

429.63 Dollars($)

Posted: Sat Aug 28, 2010 3:13 am Post subject:

Hey Niicss, Thanks for sharing the news The major difference between HECM and the HECM Saver is the low upfront Mortgage Insurance Premium (MIP). The FHA charges the upfront MIP to support its insurance fund. Under the HECM Saver option, the borrowers will have an upfront MIP of only .01% of the property's value. However, the amount of money available to the borrowers under the HECM Saver option will be quite less compared to the HECM standard option. Thanks, Jerry

dipaligopale

Joined: 25 May 2010

Posts: 790

22.70 Dollars($)

Posted: Sat Aug 28, 2010 9:25 am Post subject:

Hi Nicss, Thanks for sharing this information with us.I must admit that this will surely help those elderly citizens who are having small cash in their kitty. DIPA _________________ 1.The best of intentions must still have directions !--Unknown author 2.When I hear somebody sigh, "Life is hard," I am always tempted to ask, "Compared to what?" - Sydney J. Harris


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