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    Reverse Mortgages Tilting Toward Borrowers

    Reverse mortgage lending limits are going up! After years of stagnation, the ceiling on reverse mortgage loans is going up to $636,150. Not only that, but reverse mortgages are safer and streamlined thanks to program changes since 2013, according to a study by the Center for Retirement Research at Boston College. All of this is great news for senior homeowners ages 62 and older who are thinking of getting reverse mortgages to supplement their incomes. We've ranked the top three reverse mortgage lenders as American Advisors Group, Seniors Reverse Mortgage Solutions and Liberty Home Equity Solutions. Learn about the top three reverse mortgage lenders and how borrowers are better protected.

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    Do these top-rated lenders have any kind of quality endorsements?

    American Advisors Group, Seniors Reverse Mortgage Solutions and Liberty Home Equity Solutions are all members of the National Reverse Mortgage Lenders Association. Being part of this association means committing to working with borrowers in ethical, responsible ways. These lenders also hold high ratings with the Better Business Bureau.

    Do these lenders operate within the government's federally insured program?

    Each of these top-rated lenders participates in the government's Home Equity Conversion Mortgage program. Reverse mortgages through this program are insured, and borrowers are protected by the newest federal rules.

    When did lending limits go up, and how long will this last?

    The Federal Housing Administration raised the reverse mortgage lending limits for the period of Jan. 1 through Dec. 31 of this year.

    How did the federal government streamline the reverse mortgage program?

    Many people don't know about how the reverse mortgage program was recently streamlined. Prior to 2013, borrowers could apply for either Standard or Saver programs. The Standard reverse program ultimately cost more, but it also paid out better loan proceeds. Now, those two programs are streamlined into one midde-of-the-road option.

    Can reverse mortgage lenders give loans to people who can't afford them?

    Predatory lending was a major problem before the 2008 economic crisis. Since then, new financial regulations have reduced the likelihood of this harmful business practice. Today, customers who apply for reverse mortgages must go through rigorous financial screening to make sure they can afford the ongoing costs of property taxes and home insurance.

    How did first-year disbursement requirements help borrowers?

    In the past, borrowers who elected to receive all their reverse mortgage proceeds at once would sometimes get in to trouble when they couldn't afford the ongoing costs of taxes and insurance. Now, borrowers can only collect up to 60 percent of their proceeds during the first year of their loans. This has helped more borrowers to manage their finances and continue making payments over time.

    How are default rates expected to change under the new reverse mortgage rules?

    The Center for Retirement Research at Boston College anticipated that default rates could fall by half because of changes to the federal reverse mortgage program.

    Can lenders kick borrowers out of their homes?

    Lenders can't evict reverse mortgage borrowers as long as they keep their property taxes and home insurance policies up to date. This stability is a strength of the home mortgage program.