Reverse Mortgage Rates – November, 25 2008
November 25th, 2008 | by admin Published in News, Rates, Reverse Mortgage | 4 Comments
We will likely never see a week like this again. 10-year rates plummeted. In the colored tables below you can see the changes in benefits for the average HECM borrower (a 73-year old in a $250,000 home). A Treasury HECM+200 will give $5,811 more tomorrow. A HECM+175 will give $197 less because the benefits were at the cap last week, and the new lower rates increase the service fee set-aside.
This week, all Treasury-based HECM’s with a margin of +218 or less will pay the HECM maximum benefits. Ditto for LIBOR-based HECM’s with margins of +190 or less. Using these margins, the initial note rate on a LIBOR HECM would be 15 bp more than that on a Treasury HECM. The rates as of 11/25/08 are:
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November 25th, 2008 at 2:53 pm (#)
Would like to see the cap lowered. How about 5.0 instead of 5.5
November 25th, 2008 at 3:44 pm (#)
They have to stop somewhere otherwise we begin to chew into the MIP fund too far too fast.
November 26th, 2008 at 8:27 pm (#)
The MIP fund is now in the billions … we can afford to eat into it a little bit. In fact, it’s far too big and the MI for HECM’s should be lowered accordingly.
November 27th, 2008 at 11:36 am (#)
My original topic is lowering the cap (5.50) to calculate the principal limit not the 2% UFMIP.The MIP fund will not be reduced anytime soon because H4H and FHA Secure redefaults will dip into the fund.