Reverse Mortgage Originators, Do You Want Higher HECM Loan Limits?

image Today NRMLA sent out an urgent notice to all members about a major housing bill that includes important amendments to the HECM program, including establishing a single national loan limit, which is about to be brought to the Senate floor for consideration. It appears that this bill might raise the maximum FHA loan limit to $625,500 – but not for HECM. (The bill passed by the House of Representatives a few weeks ago includes a $550,000 national loan limit for HECM.)

NRMLA noted that they have been running into strong opposition to raising the HECM limit beyond $417,000 from key staffers working for Sen. Richard Shelby from Alabama, the top ranking Republican on the Senate Banking, Housing & Urban Affairs Committee. If the Senate bill passes with this lower amount, NRMLA cant be sure we will be able to achieve even the $550,000 limit in the House bill, once a conference is convened to reconcile the differences in the two versions of this bill.

NRMLA is asking all members of the reverse mortgage community to act today by doing the following.


Write a letter on your personal or company letterhead to each of your two U.S. Senators. You can find their addresses and fax numbers by going to Your letters should be faxed to your Senators’ offices in Washington, DC. You should also fax copies to their offices back in the state.

Here are a few things your letter could discuss:

  • More and more senior homeowners are turning to FHA-insured HECMs to help them maintain their ability to continue living independently in their own homes.
  • In a growing number of cases, seniors may face more debt than the amount they can borrow from a HECM based on today’s lower loan limits, so an increase is necessary.
  • The HECM program should be amended to allow senior homeowners to obtain HECMs based upon the same higher loan limit that would be allowed for other FHA loans under the pending legislation.
  • If you are aware of any specific cases where the higher loan limits could help protect a senior from foreclosure, please describe such instances.
  • Urge your Senators to call Sen. Shelby, as well as Sen. Chris Dodd, the Democratic chairman of the committee, and tell them they want to see a $625,500 maximum loan limit for HECM included in the bill that is brought to the floor.

NRMLA also stated that letters should be individually written because they are only effective when they are done in your own words.

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  • I do not agree with NRMLA that letters should be individually written. Volume counts, more than personal letters, because the senators or their staff will not spend their time reading them. They will however, take notice of the number of letters they receive in support of the bill.

  • I agree with Sally. It would be most helpful if you modeled needed political lobbying efforts like this after the MBA’s Mortgage Action Alliance. If you are interested in how it was set up, please contact me via email and I will give you specifics. They have made it easy to send a concise, considered and powerful response by the click of a link to the appropriate legislators for the sender’s location.

  • problem with higher loan limits is it will be more work for us. More Lawyers and CPA’s to work with with the same fee for us due to the cap. Apprasers will make more money, title companies will make more money, realtors will make more money, state tax bureau’s will make more money, Lawyers and Cpa’s will make more money. Banks will make more money.
    Orginators making more money ???????
    We need to go back to the 2% fee.
    This will be more costly for small companies if passed. Need to write our congress people to remove cap. or go back to 2% fee. No other industry has this resriction, let the market dicate what we can charge.,

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