Glossary
AIME-Average Indexed Monthly Earnings – Reverse Mortgage Glossary
Average Indexed Monthly Earnings – Social Security benefits are typically computed using “average indexed monthly earnings (AIME).” This average is essentially the 35 highest years of earnings indexed to the present by wage growth. A formula is applied to this average to compute the primary insurance amount (PIA). The PIA is the basis for the [...]
AARP – Reverse Mortgage Terms
AARP is a nonprofit membership organization of persons 50 and older dedicated to addressing their needs and interests. According to the AARP website: Membership in AARP is open to any person age 50 or above. With 25 percent of the U.S. population in the 50+ category, nearly half of all people in this age bracket [...]
Principal Limit Factor – Reverse Mortgage Glossary
Principal limit factor is a term used primarily in conjunction with the HUD home equity conversion mortgage (HECM) program, the most popular reverse mortgage program. The term is best understood if broken into components: 1. The principal limit of a HECM is the lesser of the appraised value of the home or the FHA “203b” [...]