Reverse Mortgage Rates: Government HECM & JUMBO
 
Government Insured
Proprietary / Jumbo
Program:
HECM .75
HECM 100
HECM 150
HECM Fixed

FNMA

Rev 60

E.P.A

R.S.

Rate (08/19/08)
3.22%
3.34%
3.62%
6.06%
5.875%
6.47%
5.97%
8.80%
Minimum Age
62
62
62
62
62
60
62
62
Index
LIBOR
LIBOR
CMT
N/A
1MO - CD
LIBOR
LIBOR
N/A
Margin
0.75%
1.00%
1.50%
N/A
N/A
4.00%
3.5%
N/A
Lending Limit
$362,790
$362,790
$362,790
$362,790
$417K
$150K
$1.5M
$3M
Minimum Draw
None
None
None
100%

None

50K

None

100%

*Applicable Mortgage Insurance and TALC (Total Annual Loan Costs) are not reflected.

 

Why are interest rates important when choosing the best reverse mortgage?

1.) The lower the expected interest rate, the maximum amount of proceeds are made available to the homeowner. (Principle Lending Limit)

2.) The better the index performs over time can relate to thousands of dollars of retained equity throughout the life of your reverse mortgage, meaning more inheritance for your children / heirs.

Why are your advertised rates much lower than my Bank or Credit Union?

All Reverse Mortgage Company has correspondent approval to offer a wide variety of government insured reverse mortgages. Our margins come from forward commitments secured by large banks, and these benefits are passed down to you.

If you would like an amortization schedule that projects how much interest you owe year by year please call.

Toll Free (888) 801-2762 Ext. 1 or complete our Secure Questionnaire

 

About Libor Index

LIBOR stands for "London Inter-Bank Offered Rate."  It is based on rates that contributor banks in London offer each other for inter-bank deposits.  From a bank's perspective, deposits are simply funds that are loaned to them.  So in effect, a LIBOR is a rate at which a fellow London bank can borrow money from other banks. Many types of reverse mortgage loans are indexed to the London Interbank Offering Rate. This index is used to set rates of a variety of different types of loans with adjustable interest rates.

In October of 2007, the U.S. Federal Housing Administration (FHA) ruled in favor of insuring ARM loans based on the one-year LIBOR index. At the same time, HUD also ruled to allow the one-month LIBOR to be used for the purpose of calculating adjustments to interest rates for monthly adjusting Home Equity Conversion Mortgage (HECM). Below is a chart of LIBOR rates for the last 10 years.  LIBOR loans normally have lower margin rates than CMT (constant maturity of U.S. treasuries)

 

libor history

 

About Treasury Index (CMT)

Many types of reverse mortgage loans are indexed to the Treasury. This index is an average yield on United States Treasury securities adjusted to a constant maturity of 1 year, as made available by the Federal Reserve Board.  Yields are interpolated by the United States Treasury from the daily yield curve. This curve, which relates the yield on a security to its time to maturity, is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market.

 

cmt history

 

1-Year CMT VS 1-Month LIBOR
 
Month to Month History: August, 1998 - August, 2008
Date 1-Year
CMT
1-Month
LIBOR
Aug 1998 5.21 5.727
Sep 1998 4.71 5.400
Oct 1998 4.12 5.277
Nov 1998 4.53 5.048
Dec 1998 4.52 5.118
Jan 1999 4.51 4.946
Feb 1999 4.70 5.003
Mar 1999 4.78 4.940
Apr 1999 4.69 4.902
May 1999 4.85 4.930
Jun 1999 5.10 5.223
Jul 1999 5.03 5.178
Aug 1999 5.20 5.370
Sep 1999 5.25 5.396
Oct 1999 5.43 5.410
Nov 1999 5.55 6.503
Dec 1999 5.84 5.832
Jan 2000 6.12 5.856
Feb 2000 6.22 5.907
Mar 2000 6.22 6.133
Apr 2000 6.15 6.197
May 2000 6.33 6.641
Jun 2000 6.17 6.649
Jul 2000 6.08 6.625
Aug 2000 6.18 6.628
Sep 2000 6.13 6.620
Oct 2000 6.01 6.621
Nov 2000 6.09 6.827
Dec 2000 5.60 6.565
Jan 2001 4.81 5.622
Feb 2001 4.68 5.278
Mar 2001 4.30 5.078
Apr 2001 3.98 4.435
May 2001 3.78 4.059
Jun 2001 3.58 3.835
Jul 2001 3.62 3.760
Aug 2001 3.47 3.584
Sep 2001 2.82 2.637
Oct 2001 2.33 2.321
Nov 2001 2.18 2.145
Dec 2001 2.22 1.876
Jan 2002 2.16 1.829
Feb 2002 2.23 1.883
Mar 2002 2.57 1.880
Apr 2002 2.48 1.842
May 2002 2.35 1.844
Jun 2002 2.20 1.836
Jul 2002 1.96 1.818
Aug 2002 1.76 1.820
Sep 2002 1.72 1.819
Oct 2002 1.65 1.741
Nov 2002 1.49 1.380
Dec 2002 1.45 1.382
Jan 2003 1.36 1.339
Feb 2003 1.30 1.334
Mar 2003 1.24 1.306
Apr 2003 1.27 1.318
May 2003 1.18 1.3189
Jun 2003 1.01 1.1232
Jul 2003 1.12 1.1036
Aug 2003 1.31 1.1170
Sep 2003 1.24 1.1214
Oct 2003 1.25 1.1201
Nov 2003 1.34 1.1157
Dec 2003 1.31 1.1195
Jan 2004 1.24 1.0982
Feb 2004 1.24 1.0973
Mar 2004 1.19 1.0914
Apr 2004 1.43 1.1007
May 2004 1.78 1.1089
Jun 2004 2.12 1.3582
Jul 2004 2.10 1.4929
Aug 2004 2.02 1.6482
Sep 2004 2.12 1.8401
Oct 2004 2.23 1.9870
Nov 2004 2.50 2.2826
Dec 2004 2.67 2.4178
Jan 2005 2.86 2.5892
Feb 2005 3.03 2.6895
Mar 2005 3.30 2.8582
Apr 2005 3.32 3.0826
May 2005 3.33 3.1126
Jun 2005 3.36 3.3401
Jul 2005 3.64 3.5107
Aug 2005 3.87 3.6942
Sep 2005 3.85 3.8584
Oct 2005 4.18 4.0882
Nov 2005 4.33 4.2954
Dec 2005 4.35 4.3857
Jan 2006 4.45 4.5720
Feb 2006 4.68 4.6310
Mar 2006 4.77 4.8260
Apr 2006 4.90 5.0245
May 2006 5.00 5.1071
Jun 2006 5.16 5.3451
Jul 2006 5.22 5.4045
Aug 2006 5.08 5.3314
Sep 2006 4.97 5.3229
Oct 2006 5.01 5.3198
Nov 2006 5.01 5.3479
Dec 2006 4.94 5.3279
Jan 2007 5.06 5.3201
Feb 2007 5.05 5.3214
Mar 2007 4.92 5.3195
Apr 2007 4.93 5.3201
May 2007 4.91 5.3210
Jun 2007 4.96 5.3195
Jul 2007 4.96 5.3200
Aug 2007 4.47 5.4801
Sep 2007 4.14 5.5121
Oct 2007 4.10 4.9940
Nov 2007 3.50 4.7412
Dec 2007 3.26 5.0409
Jan 2008 2.71 3.9772
Feb 2008 2.05 3.1393
Mar 2008 1.54 2.8069
Apr 2008 1.74 2.7809
May 2008 2.05 2.5315
Jun 2008 2.42 2.4702
Jul 2008 2.28 2.4601

 


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