What Are California FHA Mortgage Loan Limits in Your County?

New FHA Mortgage Rules Could Affect Home Loan Programs In California

While many individuals automatically associate the FHA with first time homebuyers, the truth is that this federal agency actually has a number of options available for individuals who currently own a home. For example, homeowners who are over 62 years of age are often able to put a reverse mortgage to use in order to put the equity that they have in their homes to use so that they can pay for other living expenses or just that they have a little bit of extra money available to enjoy their golden years with.

Of course, reverse mortgages are not without their share of controversy, but many seniors have found that these loans allow them to enjoy their retirement without having to worry about the financial pressure that they might otherwise find themselves burdened with. Unfortunately, upcoming changes to the FHA may make it difficult for certain applicants to take advantage of the pros that are available from home equity conversion mortgages in California.

Some of these changes include:

• Restrictions on the amount of money that can be dispersed after a reverse mortgage both initially and for the first year after the loan has closed
• Changes in insurance premiums for FHA mortgage programs in California (ie. HECM)
• A new single lump sum payment option
• A financial assessment for all mortgagors which will evaluate their capacity and willingness to meet their reverse mortgage obligations
• A requirement that individuals set aside a portion of their loan to cover insurance and property tax

These new changes are designed to allow the Home Equity Conversion Mortgage program to continue providing services to individuals who qualify for these loans, but they have the adverse side effect of making what is already a complex loan even more difficult for the average individual to understand. This means that individuals who are interested in availing themselves of a reverse mortgage are likely to find that the process is even more difficult than it already was and that the new guidelines make it harder for them to understand both the loan itself and what their options are when it comes to putting these funds to use in the best way possible.

Although some individuals may find that the new restrictions hamper their ability to get the maximum use out of equity that they have in their home, many older individuals are likely to find that they are still able to enjoy their retirement and put the equity that they have built up into their home to use.

Rates on FHA loans in California can change without notice. Cash out loans for bill consolidation may not be difficult to qualify for if you can stay below 85% loan to value and your mortgage history on your credit report indicates that you have the ability and willingness to make your mortgage payments on time each month.