FHA Reverse Mortgage Lender Question

Q: Are there any reverse mortgage lenders who do not require PMI (private mortgage insurance)? I was told by a realty agent friend that he believes this is mandatory with FHA. What is your opinion about this excessive charge on reverse mortgages?

A: FHA, the leading reverse mortgage lender, requires MMI (mutual mortgage insurance) on all its mortgages. This is different from PMI (private mortgage insurance), which is required on most conventional home loans with down payments less than 20 percent.

On a FHA reverse mortgage, we agree MMI premiums are totally unnecessary because the loan-to-value ratio is very low, usually far less than 80 percent of market value. The only way to avoid MMI premiums is to do business with one of the other reverse mortgage lenders such as Fannie Mae or Financial Freedom Plan.

Please call 1-888-973-8377 to have a Reverse Mortgage Specialist answer any questions.