Hello Jamie,

You can only take one reverse mortgage at a time, and the amount to which you have access takes into consideration your age, property value, interest rates, and any set-aside amounts needed.  It is possible to refinance the loan after 18 months if the new loan is significantly more advantageous to you. Still, most borrowers find that their home has not appreciated enough that the refinance is beneficial. 

Since the set-aside funds are still your money in the line of credit, eliminating a set aside is not an acceptable benefit when HUD determines its benefit rule on whether to allow a refinance. 

HUD requires that the new loan give the borrower a minimum of 5 times the cost of the loan in unique benefits (not just funds available after the set-aside funds are released) to allow lenders even to originate a HECM to HECM refinance.  So, using this example, if your new loan costs you $4,000 to complete, you must receive a minimum of an additional $20,000 in higher unique benefits. 

Some exceptions can be made, but lenders are only anxious to make them if the new loan benefits the borrower in other ways. They can defend that action because HUD can deny insuring the loan if they disagree that the lender adhered to the rules.

If my home is paid in full and valued at $170.000, but I took out a reverse mortgage loan for $80,000 as a line of credit with a certain amount set aside for taxes and homeowners insurance a year ago, Can I take out a second reverse mortgage based on the remaining equity?