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principal limit

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principal limit

The maximum lifetime amount an elderly borrower can take out on a reverse mortgage.Calculation of the principal limit is a formula that uses the age of the youngest borrower,the maximum claim amount (the lesser of the house's appraised value or the FHA's maximum loan amount for houses in the area),and the expected average mortgage interest rate.


Principal Limit

The present value of a house, given the elderly owner's right to live there until she dies or voluntarily moves out, under FHA's reverse mortgage program.

See Reverse Mortgage/FHA's Home Equity Conversion Mortgage (HECM)/Principal Limit.



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The servicer receives a report that includes an estimated principal limit after paying off current liens, servicing fees, originations fees, mortgage insurance and estimated closing costs, explained Gilster.
The computers, radio transmitters, and other electronics on the glider are powered by alkaline batteries, which are, for now, the principal limit on the length of operation.
Line of Credit: Borrower can establish a line of credit equal to the principal limit.
 
 
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