HECM Rates Trend Upward (1/29/07)
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For the third consecutive week (and sixth week out of the last seven), interest rates for the HUD Home Equity Conversion Mortgage (HECM) have risen. Higher interest rates mean: a) seniors cosidering a reverse mortgage will be able to borrow less (other factors being the same) and, b) seniors who have already secured a reverse mortgage can see their home equity dissipate more quickly as interest charges on their loan balances grow more quickly.
Rates for the Fannie Mae HomeKeeper reverse mortgage remained at their 52-week high point: 8.75%.
| Reverse Mortgage Rates | |||||
|---|---|---|---|---|---|
| Product | This Week | Last Week | 52-Week Avg |
52-Week High |
52-Week Low |
| HECM Monthly Adjusting | 6.60% | 6.58% | 6.482% | 6.77% | 6.10% |
| [tag]HECM[/tag] Annual Adjusting | 8.20% | 8.18% | 8.082% | 8.37% | 7.70% |
| [tag]Fannie Mae[/tag] [tag]Homekeeper[/tag] | 8.75% | 8.75% | 8.55% | 8.75% | 8.00% |
[tag]Reverse mortgages[/tag] are specialized [tag]mortgage products[/tag] available only to [tag]senior citizen[/tag] homeowners. HECMs are the most popular type of reverse mortgage. Interest rates for both annual- and monthly- adjusting HECM loans are indexed to the one-year constant maturity [tag]US Treasury rate[/tag].
Under a reverse mortgage, the lender makes loan payments to the borrower and the loan is repaid when the house is sold or the homeowner dies. The monthly or annually adjusting interest rate determines how fast the loan balance grows.
Visit our reverse mortgage interest rate tool for further information and analysis.
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