The Jumbo Reverse Mortgage Program on the rise as property values are starting to come back. Currently, the only lender that offers the jumbo reverse mortgage program is Generation Mortgage, which is called the Generation PLUS or GenPLUS loan. While the demand for the jumbo reverse mortgage product is only about 40 loans annually, there has been an uptick in the origination of them. And the demand may rise more if Congress has anything to say about it.The rise in the demand for the jumbo reverse mortgage product stems from home values starting to rise again across the nation. Consumers that have high valued properties want to utilize the program because of the need for greater funds in retirement.
The Home Equity Conversion Mortgage (HECM) program, which is what the HUD call reverse mortgage loans that FHA insures, currently has a maximum claim amount of $625,500 across the nation. This limit is supposed to be only temporary and will be reviewed again by Congress in 2014. In 2009, Congress raised the maximum claim amount for every county, but if they deem in 2014 that the reverse mortgage industry can handle the change, then the maximum claim amounts will fall back to their pre-2009 levels, which vary by county. This is where is jumbo reverse mortgage program offered by Generation Mortgage may start to come in handy.
The Generation PLUS loan currently has a maximum claim amount of $6,000,000 and has one particular feature that the HECM program does not offer. The jumbo reverse mortgage loan has no Mortgage Insurance Premium (MIP), while the HECM loan has both upfront MIP and monthly MIP, so the overall cost of the loan could be less. Of course the interest rate on the jumbo reverse mortgage is roughly 2% higher than the HECM loans and only comes has a fixed lump sum payout. But if your homes value is higher than $1.5 million then utilizing is the jumbo reverse mortgage may be a benefit.
The jumbo reverse mortgage may not be the correct financial product at all and every borrower needs to look into other programs that may benefit them more.
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The Jumbo Reverse Mortgage Program on the Rise
![The Jumbo Reverse Mortgage Program on the Rise]()
Reviewed by Merlyn Rosell
Published :
Rating : 4.5
Published :
Rating : 4.5