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HUD Reverse Mortgage Lending Limits: Giving the Seniors A Life That They Deserve

By Edited Oct 10, 2016 0 0

A Closer Look at HUD Reverse Mortgage Lending Limits


HUD reverse mortgage lending limits pertains to the allowable amount to be given for the beneficiaries availing loans particularly to the seniors in case of the HUD or Housing and Urban Development. This ensures that beneficiaries can have adequate support especially for those who are already retired and would really need a permanent place where they could stay.

HUD Reverse Mortgage Lending Limits, commonly known as lifetime mortgage, is a form of loan available in the United States to seniors aged 62 years old and above. This has been present for quite some time now, and is really given proper attention due to the rise of housing costs. It would be very hard for the seniors, who are retired people, to support their needs particularly their shelter, especially if they do not a have a permanent place to stay yet. This is the reason why most of the seniors end up being in geriatric homes because they do not have a better place to stay.

The Criterion: Can Everyone Avail Reverse Mortgages?

Not all can avail reverse mortgages. A criterion is set and considered at all times. First, for the seniors, what are the criteria for you to be considered as qualified to avail a reverse mortgage? Of course, age is the first consideration as you must be 62 years old and above, with no balance with any other mortgage of if there is any this must only be small and easily payable.

Reverse Mortgages And Its Pros

Reverse mortgage

Reverse mortgages are designed especially for the elderly because it does not require payments as long as the beneficiary stays in the home, it assures no debt consequences and it does not require the beneficiary to have income. This is also preferable for them because the terms and conditions, especially payments, can be arranged depending upon your needs and economic status. In the case of seniors, their mortgages can be supported through their pension which is their primary source to support their daily needs.

Reverse Mortgages And Its Cons

Reverse mortgage cons

While it has some advantages, the existence of disadvantages is truly inevitable. Lending limits are truly one of the great difficulties you have to encounter when it comes to reverse mortgages. These limits reduce your ability to maximize your chance to acquire good support and enough money. Housing and Urban Development reverse mortgages are one of the primary means of the seniors to support their retirement and if there are lending limits then their ability to support themselves might be greatly compromised.

Many seniors are now using reverse mortgages to supplement their retirement. The use of these types of support system by the seniors is truly becoming widespread. A good comfortable home is one of the most important properties of the Americans. These lending limits might be the cause of difficulty especially for the elderly to achieve such.

Policies About Lending Limits

So just about four years ago, the United States released a memorandum about new lending limits for reverse mortgages in Housing and Urban Development. The previous limit was said to be $362,790. The limit will still have to vary depending upon the location, usually smaller limits in smaller areas.

Lending limits

This limit was then changed together with the passing of the Housing and Economic Recovery Act of 2008. Through this act, there would already be no variations in limits depending upon location. There will just be a single limit that will be applied to all beneficiaries regardless of location. There is also a limit to be set on the loan source fee which is now defined as two percent of the lending limit. The loan source fee is standardized to be $2500 to $6000. On the other hand, the lending limit is defined as $417,000. It can clearly be noticed that the limit is increased to provide more support to the seniors. With the loan source fee to be taken into consideration, $8,340 would have to be paid which is clearly larger than the standardized fee.

Many are saying that the amount of the new lending limit may be higher compared to the previous but still; it is small enough to support all of the senior’s needs especially those relating to their homes. Though they may not presently contribute to the work force of the United States, they definitely have made a lot for the country. So it is through these reverse mortgages that they are somehow rewarded for a life of hard work.

Senior Citizens

Definitely, the seniors should get what they deserve. With the sources of funds of the government, it can be said that it is really possible to further increase the lending limit for the seniors. Nowadays, the cost of living is really getting high, and by increasing the lending limits, the government can best support the elderly people to attain a comfortable state of living.

The new limits have already been said but there are discussions that the Housing and Urban Development are trying to consider $625,250 for the lending limit, clearly a lot higher than the present one and truly enough to support the expenses of the seniors. It must be taken into consideration that medical expenses are increasing for the elderly and without an appropriate source of funds, they would not be able to receive appropriate health care, or they will be able to avail of such but their financial status will be deeply compromised. They might be even place themselves in a deep state of debt.


HUD reverse mortgage lending limits are the allowable loan amounts for the beneficiaries particularly for seniors aged 62 years old and above. These provide support to the elderly focusing on their housing needs. If the lending limits are not enough, it would be difficult for the seniors to cope up with their daily expenses especially with the rising health care costs.

With the new letter from the Housing and Urban Development sector, a higher lending limit was set. But, this limit is still under a lot of critic of the people because many still believe that it may still be not enough to support the needs of the seniors. They propose that a higher lending limit be considered in such case. HUD reverse mortgage lending limits must be set to an appropriate amount that will not only cater to the basic needs of the seniors but will definitely give them the good life that they deserve.



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