The Federal Housing Administration’s Mutual Mortgage Insurance Fund, the portion of the FHA that handles reverse mortgages, saw a nine-digit increase in value over the past year. Although the capital ratio of the overall portfolio remains negative, the $7.7 billion increase since 2018 marks a 50 percent increase in reserves.
The new figures released this week were followed by renewed calls from industry experts for the FHA to cut mortgage insurance premiums. The fund that manages reverse mortgages, formally known as Home Equity Conversion Mortgages, is reported to be 9.22 percent negative. But that is a noticeable improvement from the 18.83 percent in the red that the fund was at during the last fiscal year.
Reverse mortgages are powerful financial tools for homeowners over the age of 62. They provide financial security to seniors while allowing them to live in their home without needing to make monthly mortgage payments.
Today, conventional conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 15-year rates are near 3.375 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.