The Department of Housing and Urban Development (HUD) announced on Wednesday, December 2, 2020 via Mortgagee Letter (ML) 2020-42 a maximum claim amount of $822,375 for calendar year 2021, a rise of $56,775 from the $765,600 limit governing the Home Equity Conversion Mortgage (HECM) program in 2020.
What does this mean for borrowers? For folks with a home value over $765,600, this higher maximum claim may result in higher principal limits (or how much money you can borrow).
For those who already have a HECM, this increase could make refinancing an existing HECM into a new HECM more desirable.
Marina Watts
This is the reverse mortgage blog of Marina Watts, a reverse mortgage specialist licensed in California and based in Santa Cruz, California.
Marina Watts, NMLS # 1458297
This is the reverse mortgage blog of Marina Watts, a reverse mortgage specialist licensed in California and based in Santa Cruz, California.
Marina Watts, NMLS # 1458297
This material is not provided by, nor was it approved by the Department of Housing & Urban Development (HUD) or by the Federal Housing Administration (FHA). It is not intended to be a substitute for legal, tax or financial advice. Consult with a qualified attorney, accountant or financial advisor for additional legal or tax advice.
*There are some circumstances that will cause the loan to mature and the balance to become due and payable. The borrower(s) must continue to pay for property taxes and insurance and maintain the property to meet HUD standards or risk default. Credit is subject to age, minimum income guidelines, credit history, and property qualifications. Program rates, fees, terms and conditions are not available in all states and subject to change.
Reverse Mortgage Loan Officer serving Santa Cruz, Aptos, Capitola, Soquel, San Jose, Watsonville, Monterey, Gilroy, Salinas, Santa Clara, and the Central Coast of California.