HUD Approves LIBOR Index for HECMs
July 23rd, 2007 | by admin Published in FHA, HECM, News, Reverse Mortgage | 5 Comments
Last Friday U.S. Department of Housing and Urban Development approved the use of LIBOR Indexes for all FHA Arms and HECM products. HUD felt the change was necessary because LIBOR is both an international index determined on the basis of the world economy and an index that has become very popular in the secondary market. It will be interesting to see if these changes will cause lenders to alter their programs and make the reverse mortgage market more competitive. To read a copy of the document issued by HUD click the link below.
Adjustable Rate and Home Equity Conversion Mortgages—Additional Index
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July 30th, 2007 at 4:48 pm (#)
While the secondary market may like the change, it makes talking to our clients more difficult. The chosen LIBOR index may be better today, at the time of the origination. However, the cmt index may have a lower interest rate at a later point in time. So the wrong rate could have been chosen.
- Dennis Haber
DennisHaber.com
August 23rd, 2007 at 5:17 pm (#)
[…] that they are looking into releasing a new Libor based HECM product now that HUD has approved the use of the index. David Peskin, CEO of LLS, also recently said that with the backing of KBC they will be able […]
September 19th, 2007 at 5:30 pm (#)
[…] at the moment they will not be accepted. I would expect this to change in the near future since HUD recently approved the use of the LIBOR Index for HECMs and because lenders recently began announcing plans to offer LIBOR based HECMs. No word on when […]
October 1st, 2007 at 12:02 am (#)
[…] announced that they plan to offer a LIBOR based HECM product to their brokers. Back in July, HUD approved the use of the LIBOR index and lenders recently started talking about offering LIBOR based products ever since the HECM 100 […]
May 2nd, 2008 at 6:33 am (#)
[…] announced that they plan to offer a LIBOR based HECM product to their brokers. Back in July, HUD approved the use of the LIBOR index and lenders recently started talking about offering LIBOR based products ever since the HECM 100 […]