New margins on HECM loans were announced by Fannie Mae in a 10/2/01 lender letter. On HECMs sold to Fannie  after 10/30/01, the margin on a monthly adjustable HECM will be 1.50%, and the margin on an annually adjustable HECM will be 2.10%. See HUD Program Handbook for more information on HECM interest rates and margins.

New Consumer Info Services

A new consumer education program on reverse mortgages has been launched by AARP and the
AARP Foundation, with support from the U. S. Department of Housing and Urban Development
(HUD). The new homeowner education program
aims to improve the quality and availability of
consumer information and counseling on reverse mortgages and related options. For complete
information, click here.

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Equity Share Discontinued & Waived

In a lender letter dated 7/6/00, Fannie Mae
announced the discontinuation of the equity
share cost option on its Home Keeper loans
effective August 10, 2000. Fannie continues
offering HomeKeeper without equity share,
but no longer accepts Home Keeper applications
with equity share. In a lender letter dated 2/26/01,
Fannie Mae announced it will waive the equity
share fee on all loans in its Home Keeper
portfolio. Fannie has also discontinued charging
a 1% fee on Home Keeper loans as of 5/11/01.

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Financial Freedom Senior Funding Corporation
of Irvine, CA is now the nation'a largest reverse
mortgage origination company. In the latest in a
series of growth spurts, Financial Freedom FF
purchased the reverse mortgage assets of Unity
Mortgage Corp. and merged the two operations.
The company now offers the widest array of reverse
mortgage products and services over 12,000
reverse mortgages.

In earlier moves during the later 1990s, Financial Freedom acquired Wendover's western retail
outlets, California's largest originator (the Senior
Loan Center in Sacramento), hired most of
GMAC's originators when GMAC left the market,
acquired the eastern retail outlets of International Mortgage, and the servicing portfolio and products
of Transamerica HomeFirst. The company is also
involved in developing reverse mortgages in
Europe.

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On march 9, 2001, the first European reverse
mortgage securitization transaction was
announced by a vice president of Citibank N.A.,
the arranging bank. For complete information
click here.

HUD 203b Limits for 2001

The highest new 203b limit for federally-insured
"Home Equity Conversion Mortgages" (HECMs)
in the continental U. S. during 2001 is $239,250;
the lowest new limit is $132,000. The new limits
vary by county and are available online at https://entp.hud.gov/idapp/html/hicostlook.cfmat
The single national limit for Fannie Mae's "Home
Keeper Mortgage" for 2001 is $275,000.

In both programs, the amount of cash a homeowner
can get is a percentage of the home's value or of
the equity limit, whichever is less. The specific percentages are based on factors such as the
borrower's age and current interest rates.