Released: October 03, 2009

Reverse mortgages feel the squeeze

Source: Kenneth Harney, Washington Post (Free Registration)

Declining home values have put a serious squeeze on one of the mortgage market’s most popular and fastest-growing financing concepts: the Federal Housing Administration’s reverse mortgage program for people 62 and older.

In a letter to reverse-mortgage lenders Sept. 23, FHA Commissioner David H. Stevens said his agency must reduce the maximum amounts seniors can receive on reverse mortgages because of an estimated budgetary shortfall of $798 million in the program for the coming fiscal year.

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