Today HUD published Mortgagee Letter 08-35 which establishes a new national loan limit of $417,000 for all HECM loans. According to the ML, lenders must use the new national mortgage limit and calculate the loan origination fee using limitations established by HERA, and new policy guidance issued by FHA, when re-calculating HECM loans that did not close prior to October 13, 2008.
According to the ML, Section 214 of the National Housing Act permits mortgage limits for all areas of Alaska, Guam, Hawaii and the Virgin Islands to exceed the mortgage limit by up to 150%. The new HECM national mortgage limit of $417,000 effectively raises the mortgage limit in all of these areas except 1) Hilo, Hawaii; 2) Honolulu, Hawaii; 3) Kappa, Hawaii; and 4) Kahului-Wailuku, Hawaii. Enforcement of the new national mortgage limit would effectively reduce the mortgage limits in these areas; therefore, they will continue to operate under the current mortgage limits as shown below.
|MSA Name||MSA Code||County Name||County
|HILO, HI (MICRO)||25900||HAWAII||001||HI||$470,250|
|HONOLULU, HI (MSA)||26180||HONOLULU||003||HI||$544,185|
|KAPAA, HI (MICRO)||28180||KAUAI||007||HI||$544,185|
|KAHULUI-WAILUKU, HI (MICRO)||27980||MAUI||009||HI||$544,185|