HUD Lending Limits Extended for Reverse Mortgages

The US Department of Housing and Urban Development has finally officially extended the loan limits for its FHA insured reverse mortgage program with Mortgagee Letter 2009-50.

There was a risk that after the end of the year, Reverse Mortgage Loan limits may have been reduced back to the limit previously set at $417,000. The excellent news is that the the lending limit is now going to be extended for another year.

The current CR mandates that the revised FHA loan limits for 2010 are set at the higher of the loan limits established under the Economic Stimulus Act of 2008 (ESA) or those loan limits otherwise established for 2010 as amended by the Housing and Economic Recovery Act of 2008 (HERA).

Under provisions of the recent CR, the national FHA loan limit for the HECM program in 2010 remains at $625,500 (150 percent of the national conforming limit). In the special exception areas (AK/HI/GU/VI), the maximum claim amount on HECM mortgages is the same $625,500 limit as in all other areas. The loan limit shall be effective for all HECMs that have been assigned a FHA case number on or after the effective date of this Mortgagee Letter.

To read about the increase in lending limits, click here!