When applying for a reverse mortgage, you might desire to know about the reverse mortgage limits. These limits could affect you depending on the value of the home. Actually, there are “hard” limits and “soft” limits.

A hard limit is the limit set by the FHA. At present time, 90 percent of reverse mortgages are FHA insured. Therefore, the upper barriers set by the FHA are very considerable.

At this time, the FHA limit fluctuates from $200,160 and $362,790. The lower limits are used for country areas and the upper ones for large cities or states where the cost of living is higher. Also, the upper barrier can be adjusted up to 150 percent in Alaska, Guam, Hawaii and the Virgin Islands.

These limits are modified every year. Still, to get a realistic picture of how much you can borrow, you need to understand about the soft ceilings. Soft limits veto homeowners of high price homes to borrow more than those with homes valued at the FHA boundary and also set the actual amount you can get.

The soft boundary can be considered the actual limit for your house since it will set how much you can borrow. The amount that you can borrow is calculated from the lower of the appraised worth and the FHA boundary.

The actual funds owners can borrow depends on their age, the market rates, diverse credit fees and the appraised worth of their home or FHA’s mortgage ceilings for their region. In general, the more valuable your home is, the older you are, and the lower the interest rates, the more you can borrow.

For instance, homeowners with a $100,000 home lona at 9% interest rate could get up to 22% of the house’s value if they are 65. If the homeowners are 75, they could get up to 41%, and up to 58% if they are 85 years of age.

In addition, remember that there are no asset or income ceilings on borrowers applying for a HUD’s reverse mortgage. This basically means that you can have poor credit or earn no money or too much money and still be able to qualify for the loan. Nobody could be excluded because earnings, assets, or poor credit.

Remember, before you get a home mortgage, discuss it with your professional mortgage broker about the reverse mortgage limits so that you can get a more realistic opinion of how much money you can borrow by apply for this type of mortgage.