The 10-year Constant Maturity Treasury fell another 4 bp today to 2.10% — another record low. We’re in territory where the Principal Limit is maxed out, and the SFSA and tenure conversion factors are the only things moving with rates. Lower rates mean less money since lower rates give higher SFSA’s. This week a Treasury HECM+225 gives $144 more than a HECM+200 (all from a lower SFSA).
This week, all Treasury-based HECM’s with a margin of +338 or less will pay the HECM maximum benefits. Ditto for LIBOR-based HECM’s with margins of +303 or less. The rates as of 12/30/08 are:
And, some HECM lending limits are going to change on New Year’s Day:
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