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HECM Credit Line Growth Could Slow Substantially Under New Rules

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Since HUD’s reverse mortgage rule changes took effect October 2, Home Equity Conversion Mortgage experts and researchers have struggled to get a clear picture on what they might mean for the loan and its use as a retirement product.

But one trend is emerging: New principal limit factors and annual insurance premiums will result in slower growth for the line of credit (LOC) option, a popular tool in some borrowers’ retirement strategies.