Article by Anthony Seruga and Yolly Bishop
If you’re a senior citizen and you own a home, chances are very good that you’ve been approached about the advantages of a reverse mortgage: stay in your home, use the equity, and never make a loan payment even though you’re spending the cash. It sounds too good to be true, doesn’t it?
For the right person, though, it’s not. A reverse mortgage on your home real estate is perfect for senior citizens who don’t intend to leave a house to heirs, who would prefer to use up cash in a house before being forced to use it to pay for late-life medical bills, and who want to get the most out of their golden years. All others should consider disadvantages as well as the advantages carefully.
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Article by Juhani Tontti
Have you ever thought, if you have taken the reverse mortgage loan, what the term permanent residence mean? Have you pondered, how long you are allowed to be on a vacation or in the hospital?
The HECM reverse mortgage loan is meant to arrange more disposable money to the senior. It uses the equity of the permanent home, i.e. the loan is taken against the home equity. Therefore it is natural, that there are certain rules about the usage of the home. The reverse mortgage uses the equity of the permanent home and nothing else is allowed.
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Article by N. Sioris
Reverse mortgages are becoming popular financial planning tools for seniors in retirement. When Social Security was first implemented in 1935 the average life expectancy was 65 years. Today people are living healthier lifestyles and with improved medical technology we are living far longer than Franklin D. Roosevelt ever imagined. This is a sort of good news/bad news statistic. One of the greatest fears for older Americans is that they will outlive their assets. Even if you thought you adequately funded your retirement when you first retired, you may live so long that you will run out of funds to support yourself. The fear of insolvency will increase as life expectancies continue to climb and Social Security and Medicare become more tenuous. The enormous pressure that will be put on these entitlement programs when 78 million baby boomers begin to retire in the next couple of years, is almost incalculable. One thing for certain, is that we are all going to have to take steps to be personally responsible for funding a greater portion of our own retirement and health care than we might have predicted.
One funding source that has been gaining in popularity in recent years is the reverse mortgage. A reverse mortgage is a special type of loan that allows a senior homeowner (62 or older) to convert part of the equity in their home into tax-free cash that can be used for any purpose. There are no payments made by the borrower during the life of the loan and the loan only becomes repayable when the homeowner permanently leaves the home. The homeowner does not have to own the house free and clear, but if there is an existing mortgage on the home, it will be paid off with the proceeds from the reverse mortgage. Whatever remaining equity is left can be distributed in several different ways to the homeowner. The most popular forms of receiving the excess proceeds are either as a lump sum or as monthly tenure payments to the homeowner for as long as they live in the home.
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Question by no_nonsense: 2 wrong reverse mortgage appraisals: borrower manipulated?
My mom had 2 appraisals while she had her Rev Mort. One completely omitted an entire room, and one listed her flooring as vinyl/carpet instead of wood/tile. Why did the lender loan her money when the appraisals were so wrong? Why elderly mom probably didn’t even look at the small print in them.
How could the lender not know about the missing room? That’s information that anyone can get. Sounds like the lender was being manipulative, Agree?
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Article by David East
For senior homeowners there is an important financial vehicle available to them that they should take the time to research and understand. This vehicle is the reverse mortgage loan, which allows seniors to take advantage of the equity they have built up in their homes. However, seniors really need to have the facts about these kinds of mortgages as there are unscrupulous people who might try to take advantage of them if they are not familiar with the details of acquiring a reverse mortgage.
While a reverse mortgage can be a great tool for seniors to use for improving their financial stability and security, there is an origination cost for these types of loans. There is also a 00 cap for the origination fee and most reverse mortgage lenders will not add any other fees or costs to the loan. If you are dealing with a reverse mortgage broker or company that tries to charge more, then you should move on to the next company. You will find that there are many lenders of this type in the marketplace, so don’t hesitate to compare the upfront costs and the terms of the reverse home loan they offer.
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Article by Juhani Tontti
Have you decided to take a reverse mortgage, but think that the present economic situation is a bad time? Have you thought, that the downfall in the economy has spoiled the reverse mortgages, because the future looks uncertain?
Dont be like the typical error maker, who acts, when the news are good and is afraid to act, when the news are bad and the prices down. It is a sad thing to notice, that the news draw seniors to make the wrong conclusions. The reverse mortgage is like whatever financial product and the prices fluctuate following the demand in the market.
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Question by Smartass: How does a lender benefit from reverse mortgage?
Looks like, what I read tells me, the lender pays the homeowner roughly up to 65% of the home’s value, or up to $ 625,000
What is the benefit for the lender to put up such cash? Do they collect the house when the borrower dies? Or at any point? What must a borrow “violate” or “do wrong” for the lender to “win” (in comparison to traditional mortgages, where a person stops making payments and the lender collects his house).
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Article by Issac Gates
The financial market has introduced a number of loan alternatives that the finance seekers can opt for. Two of the most popular financial options are Florida reverse mortgage and hard money options. The former is the financial solution that is meant for the retirees, who find their pension to be insufficient in fulfilling their essential needs.It serves to be a very significant way of earning a regular post-retirement income. However, in many cases, the retirees think that the amount given to them is quite less than what is offered by other lenders. In such a scenario, they have the right to transfer their mortgage, which is termed as the Florida reverse mortgage scheme. Florida reverse mortgage is no different than what original mortgage in equity release is. The only thing is that you shift from one lender to another. The benefits and features offered in this case are same as the equity release. Though this scheme is a shift from the original one, the income that it offers is more than what the previous deal offered. This is, however, the only reason that compels the retirees to transfer their mortgage from one lender to another.Even the eligibility criteria for applying for the Florida reverse mortgage are similar. Fifty and above years old people with an ownership of a property are eligible for getting enrolled to these schemes. Hard money finance is another very common and a significant financial option in recent times. This is because unlike bank loans, these loans are the best for fulfilling the seeker
Article by Juhani Tontti
So the reverse mortgages on house work another way round, than the usual mortgages. You may remember, that you had to pay to your lender the monthly back payments for years. The reverse mortgages on house are convenient, because the lender pays to you every month and you have not to do any monthly back payments.
1. Who Can Qualify?
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Article by 2ndhome Specialist
Do you have clients who want to buy a second home but who are hesitant given the current market conditions? Now you can offer your clients another solution when it comes to financing their dream vacation home,. The answer: reverse mortgages.
New data from the Department of Housing and Urban Development (HUD) reveals that more than 300,000 seniors have used the federally insured Home Equity Conversion Mortgage or Reverse Mortgage, to convert the equity in their homes into cash without having to move. Even though this is a significant number, it represents only about one percent market penetration. In the first quarter of 2007 alone, there was a billion increase in senior home equity. This increase was reflected in a 0.4 percent increase in the Reverse Mortgage Market Index (RMMI) to 205.6 from 2o4.7 in the previous quarter.
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