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Interest Rate of a Reverse Mortgage - The Bills.com Blog
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Interest Rate of a Reverse Mortgage
Sunday, Jul 15, 2007
Question: ARE ALL REVERSE MORTGAGES CALCULATED USING THE ADJUSTABLE RATE ON INTEREST? IF SO WHY?
Answer: Thank you for visiting Bills.com. Here is an answer to your reverse mortgage question - which I think I can help you with.You are absolutely correct; all reverse mortgage products currently available to consumers have adjustable rates.
The reasons for this are somewhat complicated and mostly have to do with the secondary mortgage market and FHA and HUD rules. In the simplest terms, however, banks don't know how long the customer will have the loan (the term is based on when the borrower either vacates the property or passes away), so they don't have a fixed period for calculating their expected
return. The interest rate is indexed to the One-year U.S. Treasury Securities plus a margin of one-and-one-half per cent (1.50%). Lender origination fees are fixed by the FHA at 2% of the lending limit.
Bills.com makes it easy to compare mortgage offers and different loan types. Please
Bills.com makes it easy to compare mortgage offers and different loan types. Please
visit the loan page and find a loan that meets your needs at
https://www.bills.com/mortage/refinance
I hope that his helps you make the right decision for your particular situation, but be sure to shop around and find a loan that meets your needs.
If you would like more information, please visit our Reverse Mortgage Resource page
https://www.bills.com/mortage/refinance
I hope that his helps you make the right decision for your particular situation, but be sure to shop around and find a loan that meets your needs.
If you would like more information, please visit our Reverse Mortgage Resource page
Also, make sure to get a free financial health check-up with Bills IQ!
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