Why You Should Consider Getting A Reverse Mortgage

A few years ago, if you had told someone that you had a reverse mortgage, you would have gotten a look that said, “Oh, I’m sorry you had to take one of those.” It was considered a product of the destitute. Today, you are more likely to have a conversation of curiosity. People will want to know what you think about the experience.
It’s true. Reverse mortgages have gone mainstream. They are enjoying unprecedented popularity, and not only among those who “need” the money. Seniors are now using reverse mortgages to help pay for the “wants” in their retirement years. As of 2007 more than 300,000 senior have used the FHA HECM program to tap the equity in their homes. Reverse mortgages are growing by leaps and bounds every year and are now the fastest growing segment of the mortgage industry. Indeed, as education about the real benefits of the reverse mortgage has spread, the informed senior as well as their advisors, have embraced this innovative product.
The reverse mortgage, a loan product that gives homeowners age 62 and over the ability to tap a portion of the equity in their primary residence without having to sell the property or take on a new mortgage payment, is here to stay. Although the reverse mortgage has existed for many years (the first one done in America was back in the 1960′s), the structure and safeguards of the product today have made it an attractive way for many seniors to finance those golden years.
In a nutshell, the reverse mortgage can provide equity to borrowers who qualify for as long as they live in the home. The borrower controls how the funds are taken- either in a lump sum, monthly allowance, line of credit, or any combination of the three. So for example, if a senior wants to eliminate some debt, receive a monthly check, and have some funds in reserve for future needs, the reverse mortgage can satisfy all of these. If there is a mortgage or home equity loan/line on the property, it must be paid off when the reverse mortgage is taken. For many, simply having this mortgage payment “go away” is enough to make a big difference in their monthly budget. If a senior is currently making a home equity loan payment of $300.00 each month, that $300.00 can now be put toward other monthly obligations or expenses such as prescription medications.
The amount of reverse mortgage funds available to a senior homeowner is based on several factors. First, the age of the youngest applicant is used. Of course, the minimum age is 62. In addition, the home value, as determined by an appraisal is taken into account. The location of the property (FHA maximum lending limits vary by county) is another factor Lastly, the current interest rates (depending on which product is selected) is the used in the calculation. These pieces of the puzzle will determine the amount of reverse mortgage proceeds the senior homeowner can take. If there is an existing mortgage or any type of lien, it must be paid in full at the time the reverse is taken. Other than that, the use of the funds is determined by the homeowner. And the funds are tax-free (it’s just equity) which makes the reverse mortgage the best option for many of today’s informed seniors.
Just what do seniors use reverse mortgage funds for? The answer to that question is as varied as the borrowers themselves. Some common uses include medical bills, prescription medication expenses and co-pays, real estate taxes, upkeep on the property, and supplementing current monthly income. With nearly 90% of seniors in our country relying on Social Security in some part to meet monthly expenses, proceeds from a reverse mortgage can meet a real need. These uses for reverse proceeds mentioned here represent “needs” that seniors have. But there are many who are using the reverse mortgage to actually enhance their quality of life during their retirement years.
More and more seniors are taking reverse mortgage proceeds and using these funds for travel, purchasing a motor home, gifts to children, funding grandchildrens’ college education, and charitable giving. Some are even putting this equity to use in the purchase of a vacation property or second home. Home improvement or modifying the home to meet the seniors’ needs is another use for reverse mortgage funds that has increases recently. Instead of moving out of the home and taking a one level apartment for instance, a certified aging in place specialist contractor (CAPS) can be called in and make recommendations on how the home can be modified to allow the senior to remain in the home in comfort.
Clearly the uses for reverse mortgage funds are as many and varied as the seniors themselves. As the program continues to grow in popularity, more and more ways to put that stored up equity to good use are sure to evolve. One thing is for certain, the reverse mortgage is here to stay and that is good news for both seniors and their families.

Reverse Mortgages = Journalistic Opportunism

On July 5th 2008, Robert Powell of the Wall Street Journal online posted an article which quotes the Chief Executive of The Financial Industry Regulatory Authority (FINRA), Mary Schapiro, entitled Three Warnings for Hard Times: Beware of Strategies That Put Nest Egg at Risk.
I really must admit that when I first read the title I thought, Here we go again, another article by another journalist knocking reverse mortgages. As I started to read and I saw the quoted expert, and as an individual who has been a mortgage banker for 32 years and has worked closely with many Wall Street investment firms for that last 10, I started to think that the Financial Industry Regulatory Authority had to be a recent attempt at stopping the bleeding as obviously there was no one of any authority who had truly been regulating the financial industry for a while!
I remember thinking that securities firms such as Bear Stearns, Lehman Brothers, Goldman Sachs and countless other securities firms that engaged in the activities resulting in the sub-prime and Alt A debacle that has left this country in the worst credit crunch in most working peoples lives could have been avoided had a Regulatory Agency taken just a slight glance at the product these companies were encouraging lenders to fund and then securitizing to sell to unknowing investors.
I thought, this is the expert source Mr. Powell uses to spread yet one more wave of panic about reverse mortgages through the market place? Let’s face it, reverse mortgages are a popular subject these days and anything having to do with people’s financial situation is also newsworthy so I decided to find out exactly what FINRA was all about and what they actually said.
First I went to the FINRA website and did some research on Mary Schapiro, the individual quoted in the article. Ms. Schapiro has a very impressive resume. So after reading the article and seeing the excellent credentials of the Chief Executive of FINRA, Mary Schapiro, I wondered, how could the article be so misleading? Because the first bullet point in the article says that if you take a lump sum, it could affect you or your spouse’s eligibility for some programs such as Medicaid and left the statement there. That’s a true statement under some circumstances.
If you aren’t paying off an existing mortgage with that lump sum and you have a large amount of cash, then it could affect some need-based programs. But they don’t tell you that if you have an existing payment that you replace and there is no cash left over, that lump sum has no effect on programs but could permanently end the burden of monthly mortgage payments and improve the borrower’s quality of life.
They don’t tell you that there are many options to obtain the money which helps borrowers with their lives if they are struggling, other than the lump-sum option. They don’t tell you that every borrower is encouraged to seek competent financial advice pertaining to their circumstances and are required to go through HUD approved counseling before any services can be ordered on their behalf.
In the FINRA announcement of June 26, 2008, FINRA states that Whether the decision is right for you may ultimately depend on a number of factors your health, your spouse’s health, other sources of income, the reason you’re tapping your home equity, when you do it, and how wisely you use your home proceeds. Then they warn that borrowers should also beware of broader financial impacts of the decision.
All sound advice but not exactly the reverse drawback that the author throws out. Next, the author, Robert Powell tells you depending on the laws of your state, you may not have the same protection against creditors. Talk about vague threats! How many states will this affect and what creditors? What type of debts, and again, are they referring to excess cash if the borrower has a large amount of unpaid debts and they take a large sum of cash, put it in the bank and then creditors seek payment? Are they referring to potential future creditors? This is a terrible way to put fear into the hearts of senior borrowers.
I didn’t know to which specific creditors the author, was referring but with my admittedly limited legal knowledge, I knew most creditors can seek judgments which can be filed against properties anyway so this confused me. The FINRA announcement specifically states that depending on the laws of your state, a reverse mortgage may not enjoy the same home-equity protection and that there may be a loss of a homestead exclusion. As of this writing, I am unaware of any such losses and am planning on researching this further as neither FINRA nor the author used any state as an example of where this could possibly happen.
Powell’s third and final drawback is that a reverse mortgage isn’t the right choice if you want to leave the house to your heirs. WHAT?! A reverse mortgage does not affect what you do with the property after death. Heirs still inherit the property according to the wishes of the property owner.
If Mr. Powell is trying to state that because the senior homeowner will be using a portion of the equity for their daily lives then, it is true. A reverse mortgage is known as a reverse mortgage because it operates in a reverse manner as a normal, forward mortgage it is a rising debt falling equity loan as opposed to the typical rising equity falling debt loan. What this means is that the balance does rise on a reverse mortgage, but those funds are utilized by the individuals who were responsible for paying down that loan in the first place to allow them to age in dignity and in place.
This statement did come directly from the FINRA announcement so I think that both the author and FINRA should have explained that there is no problem leaving the home to your heirs, if it is more important to leave a property that is free and clear of a mortgage encumbrance than for the senior homeowner to extract equity for living expenses, then by all means, I would not encourage the borrower to take out a mortgage against the property. But then again, I would not encourage any borrower to take out any loan they did not need, reverse mortgage or otherwise.
Obviously neither Mr. Powell nor FINRA has ever sat across a table from a borrower or a couple who couldn’t meet their monthly obligations during these times of rising costs, they never talked to borrowers who had $ 25 left in their account on the fifteenth of the month and had to figure out a way to make ends meet for the remainder of the month until they received their next check, and they certainly never sat down with senior borrowers talked into an option arm by an unscrupulous lender (selling to poorly supervised Wall Street Securities Firms) who are now losing their home because they can’t make the new rising payments. We have had more than a dozen such cases in our small company alone, sadly, 5 of which we were unable to help. As a mortgage banker you could say that I have a stake in making sure that people continue to want to take out reverse mortgages.
But as a man who has sat across the table from senior borrowers who have welled up with tears when you have told them that they were done and never had to make another payment for as long as they lived in their home, it’s aggravating to read accounts like this from those who haven’t been there and send out a message that could confuse or scare off someone who could really use this instrument with a half-truth.
As a person who has seen borrowers who did not qualify for a reverse mortgage because they owed too much due to falling values, etc, and watched them weep openly when you had to tell them they could not get the reverse mortgage, it’s infuriating to read someone flippantly suggest that you might want to downsize in a market where real estate is not selling and go rent which indicates to a senior borrower who has lived in their home sometimes for 20, 30, 40 years or more that you think they can just pick up and move and give up the home they love and where they feel comfortable.
And yes, reverse mortgages are expensive loans and not for everyone, But has anyone figured out the costs of selling a home and relocating lately, not to mention what it does to you psychologically, especially when it’s something you’re forced to do? And finally, it just makes me sad when I see an article where people don’t even consider the value of the senior borrower and their ability to age in place and dignity.
These people worked hard for their homes and I do agree with the premise that a reverse mortgage is not right for all people. The last thing I would want to see is someone getting a loan, any loan, that is not right for them. We counsel borrowers on the costs of reverse mortgages every day and if Mr. Powell wants to suggest that family members stay involved with senior borrowers contemplating a reverse mortgage due to the costs involved and the other financial implications, I would be the first to applaud his efforts.
When you read the entire FINRA announcement, it doesn’t say not to get a reverse mortgage, it says that the bottom line is that all options including downsizing, selling and renting, consolidating debts, looking into other government assistance programs and seeking help from children or other heirs may be less expensive or lower cost ways to address your needs.
I would agree with the FINRA assessment, but the senior borrowers with whom I’ve worked loved their homes and don’t want to move and shouldn’t have to if they’ve worked all their lives to build up the equity and that equity can provide a way for them to stay in the home. Many have had their children living with them because they themselves have been forced to move in with their senior parents and often are not in a position to help with anything in this economy.
I just hate to see people given wrong or half the facts to support a journalistic position that is popular at the time.

A Reverse Mortgage Discussion

Reverse mortgages are a way for seniors aged 62 and above to take cash out of their house. The equity the senior has built up over the years can be used beneficially to aid in their retirement. Here are some thoughts and ramblings about reverse mortgages that you may find helpful.

Seniors can choose to take the cash from a reverse mortgage as a lump sum, in a line of credit or in monthly payments. If

they choose a lump sum, for example, Forer said that they could pay to retrofit their home to make kitchens and bathrooms

safer and more accessible? Especially important to those who are becoming frail and in danger of falling. As one grows older

all the appliances etc. can be fitted differently to help in everyday functioning. Seniors, in a very personal way, know that

staying in their home, close to their memories and in a familiar neighborhood, can be very important factor in enjoying

retirement. Securing a Reverse Mortgage enables a senior to do that, and many companies are designed specifically to assist

seniors with reverse mortgage needs. Senior home ownership and life expectancy rates are climbing steadily and therefore more

seniors are qualifying for reverse mortgages. Accordingly, now is the ideal time to establish consumer protections so that as

the reverse mortgage industry grows, current pitfalls and hazards for consumers do not expand as well. The national reverse

mortgage lenders association does that.

When deciding what options to pursue with a reverse mortgage make sure you check the NRMLA site which forbids fraudulent

activities. Here is a direct quote from them “National Reverse Mortgage Lenders Association (NRMLA) is the national voice of

the reverse mortgage industry, serving as an educational resource, policy advocate and public affairs center for lenders and

related professionals. NRMLA was established in 1997 to enhance the professionalism of the reverse mortgage business. Our

mission is to educate consumers about the pros and cons of reverse mortgages, to train lenders to be sensitive to clients’

needs, to enforce our Code of Conduct and Best Practices, and to promote reverse mortgages in the news media.”

Seniors actively considering a reverse mortgage could certainly find value in comparing their personal expectations with the

experiences of actual borrowers. Most HECM (Home Equity Conversion Mortgage) borrowers are estimating their future ability

(or desire) to

Finding Honest Reverse Mortgage Companies

With millions of Americans now at or approaching retirement age, the problems of failed pensions, inadequate social security, and escalating health insurance costs are threatening to cause a massive increase in the number of seniors who will be struggling to stay financially afloat during their golden years. Many of these people have turned to reverse mortgages as ways to supplement their retirement incomes, and if you are thinking of joining their ranks, you need to be sure your reverse mortgage is handled by a reputable lender.
Wherever there is money, there are people trying to steal it, and the reverse mortgage market is no different. It’s far from unusual for fraudulent reverse mortgage companies to demand huge up front application fees from their customers, all the time knowing that they have no intention of accepting them as borrowers.The NRMLA
One sign that you might be dealing with shady reverse mortgage companies is if you are being asked to pay a large amount, say 5%, of the amount you expect to borrow, as an application fee. If you find yourself in that position, the first thing you should do is research the backgrounds of the reverse mortgage companies in question with the National Reverse Mortgage Lenders Association.
The NRMLA has been working to protect the interests of reverse mortgage applicants since 1997, and its website identifies approved reverse mortgage companies according to their states. The Department of Housing and Urban Development, or HUD, also has a website with information on various reverse mortgage companies. Both sites offer their resources at no charge.
The NRMLA website, in particular, is a terrific resource for those seeking information on reverse mortgage companies. It also gives you all the details involved in the process of applying for your reverse mortgage, and even offers a calculator which will tell you, based on the current market value of your home, how much money a reverse mortgage can bring your way.The Code Of Conduct
Even better, the NRMLA has established a Code of Conduct which all its member reverse mortgage companies are required to honor. The Code of Conduct is written to protect the specific needs of older homeowners, and to keep member lenders from trying to use the applicants’ lack of knowledge concerning reverse mortgages against them
The NRMLA has also drawn up a Code of Conduct to which any reverse mortgage companies must agree before being listed on the NMRLA site as an approved lender. Their Code of Conduct requires that approved reverse mortgage companies be sensitive to the unique needs of senior citizens, and do nothing to take advantage of their unfamiliarity with the reverse mortgage process.
When you’ve spent some time looking over your financial options for retirement, and have become comfortable with the idea of a reverse mortgage, head for the NRMLA site to look for the approved reverse mortgage companies in your area. When you have settled on the lenders nearest your home, use the contact information provided on the site to set up in-person appointments. And if you can find people who have already been through the reverse mortgage process, and will share their experiences with you, so much the better!

Reverse Mortgage Wholesale Loans: Where Your Money Comes From

A reverse mortgage wholesale product is not directly available to you as an applicant for a reverse mortgage. It is sold to a lender at a discounted (wholesale) interest rate, and the lender then offers it to you after adding points to the rate.Sources Of Reverse Mortgage Wholesale Loans
There are only three organizations who sell reverse mortgage wholesale products; Fannie Mae; the Federal Housing Authority (FHA); and the Financial Freedom Cash Account. The loans from each of these entities vary in their available payment alternatives.
The FHA reverse mortgage wholesale product is called the Home Equity Conversion Mortgage, or HECM. The maximum you may borrow against your home in this program is about $360,000, but your limit will depend on your home’s location. The HECM is the reverse mortgage wholesale product underlying over 90% of all US reverse mortgages.
Both the FHA and HUD–the Department of Housing and Urban Development–guarantee FHA reverse mortgage wholesale loans. The guarantee means that the borrower is assured of getting the amount promised, and that the lender is assured of getting the entire principal and accrued interest when the loan is terminated, even if the home is sold for less than that amount.
Fannie Mae guarantees its Homekeeper reverse mortgage wholesale loans, which will allow you to take up to $417,00, and is somewhat unusual in that Fannie Mae allows you to use the proceeds from your existing home to purchase a less expensive one. Although Fannie Mae is not run by the Federal Government, the amount of business they do, and the strict regulations to which they must adhere make their guarantee of their reverse mortgage wholesale loans as solid as those of the FHA and HUD.
Both FHA and Homekeeper reverse mortgage wholesale loans are available in all fifty states.
Financial Freedom Cash Account reverse mortgage wholesale products from a subsidiary of Shearson Lehman are designed for homeowners wanting to borrow against high-value homes, usually with a minimum appraised value of $500,000. There is no limit to the amount which can be borrowed with a Financial Freedom Cash Account loan, and the loans are privately guaranteed. They are, however, only available in twenty-four states.Where To Find A Reverse Mortgage Lender
Because you, as an applicant for a reverse mortgage, are not eligible to get a reverse mortgage wholesale loan, you should comparison shop among reverse mortgage lenders to find the ones who offer the lowest markups on their products. You can find a list of reliable lenders in your state by doing a search at the National Reverse Mortgage Lenders Association–NMRLA–website.
Once you start looking for a reverse mortgage wholesale through LLS Financial or any other company, you will quickly start to see a trend. You want to check on how quickly each of these reverse mortgage companies will be able to approve you. Typically a loan takes a couple of weeks to process – but when it comes to a reverse mortgage wholesale you should be able to have your reverse mortgage in hand within twenty four hours

Seven Alternatives To Consider Before Getting A Reverse Mortgage

Reverse mortgages are hot. Baby boom demographics, inadequate retirement funding, and problems in the traditional mortgage market (pushing brokers into alternate products) have combined to make marketing of reverse mortgage products to senior citizen homeowners one of the hottest niches in the mortgage business.
And the effort is paying off for marketers. Federally-insured Home Equity Conversion Mortgages (HECMs) are the predominant type of reverse mortgage in the U.S. Recently, the number of HECMs originated has averaged about 9,000 per month, more than double the average in 2005. Moreover, about two-thirds of the total HECM reverse mortgages ever issued have been originated in the last two years.
Reverse mortgages are only available to homeowners age 62 and older who have paid off their mortgage or have only a small mortgage balance remaining. The sales pitch for these loans is enticing: tax-free retirement income for as long as you own the home – even for life; no monthly loan payments; no repayments until the home is sold, and payment options flexible enough to meet any need! In many cases a reverse mortgage is the ideal tool for senior homeowners.
But there is one big drawback with reverse mortgages: high up front closing costs that can sometimes reach $20,000 or more. Combined with the regular interest that accrues on the loan balance, the up front costs can make this an extremely expensive way to borrow. To spread these costs out and make the cost of borrowing reasonable, it is imperative that the borrower be confident in their ability to remain in the home for at least 5-7 years and, preferably, longer. Unfortunately, government data shows that most HECMs are paid off in seven years or less.
So, while a reverse mortgage may be a good fit for seniors in many situations, it is always important to carefully explore alternatives to see if a more cost-effective means to achieve your retirement financing goals is available.
We discuss below seven alternatives for you to consider:
1. Intra-Family Loan – Do you have a relative or friend with deep pockets and a good heart? An intra-family reverse mortgage loan can be an excellent way to gain the advantages of a reverse mortgage, but avoid most of the costs. The concept is straightforward: instead of a bank lending you retirement funds in exchange for a lien on the house, structure an arrangement with a relative or friend to lend you the money instead – collateralized with your home, of course. You can avoid most of the up front costs this way and have more flexibility to set interest rates and loan terms. There is even a company called Circle Lending (http://www.circlelending.com/familyadvantage/reverse-mortgage.asp) that specializes in drafting these loans as “official” arms length transactions and then provides monthly loan servicing just as a traditional lender would do.
2. Price Appreciation Agreement – There are also firms that will give you money today in exchange for an “equity-share” in the future appreciation of your home’s value. These programs are usually aimed at higher value homes (over $500,000) and may only be available in areas of the country with a track record of strong property value growth. The benefit of these programs is that you may be able to tap into your equity without the high up front costs of a reverse mortgage. The drawback is that it could cost you substantially more in the long run in the form of foregone home appreciation.
If you think this type of arrangement may be a good fit for you, here are two programs to look into to: Equity Key (http://www.equitykey.com/) and, Rex Agreement (http://www.rexagreement.com/)
3. Home Equity Line of Credit (HELOC) – As noted, reverse mortgages make most sense if the homeowner is able to remain the home for seven years or more. The reality, however, is that more than one-half of all HECM reverse mortgages terminate in less than seven years. To finance short and intermediate cash needs, a HELOC loan may provide a more cost-effective way to tap into your home equity. With a HELOC, closing costs are generally minor (sometimes zero). The downsides are two-fold: 1) there are monthly loan payments required and, 2) you will likely need to show the lender that you have adequate income to make the required loan payments.
An “interest-only” HELOC loan typically requires monthly payments equal only to the accumulated interest on the amount borrowed to date. With care it is possible to borrow an amount each month that provides cash for living expenses and is adequate to make the monthly interest-only payment. In this way the HELOC mimics a reverse mortgage with interest building up in the loan balance until the loan is repaid when the home is sold.
4. Delay Receipt of Social Security Benefits – The majority of Americans start their (reduced) social security benefit at the earliest possible age (62). While people may feel it is smart to “get the money while you can”, the truth is that Americans are living longer than ever before and the decision to take early social security can cost you several hundred dollars per month for the rest of your life. People in their seventies and eighties often feel a reverse mortgage is needed to close a budget gap – a gap that might not exist if they were receiving full social security benefits.
5. Sell and Downsize or Rent – Using home equity to help pay for retirement is not a new concept. For generations, it was common for elderly homeowners to sell their homes and use the proceeds to buy or rent a smaller, more affordable dwelling. This remains a viable strategy and one of the best methods available to ensure you get full use of your hard earned home equity.
It is sometimes possible to sell your home to an “investor” and who will then rent it back to you. This provides you with needed cash while allowing you to remain in the home. Investors like this type of transaction since they get a “good” tenant who likely will take good care of the property.
6. Deferred Payment Loans – Many states, local governments and nonprofit organizations sponsor loan programs for the benefit of “house rich, cash poor” senior homeowners. Much like reverse mortgages, these programs lend money today that is paid back when the senior homeowner sells the home or dies.
The drawbacks are: 1) the use of loan proceeds is usually restricted to a specific purpose (e.g. home repair, payment of property taxes or special assessments, etc.) and, 2) eligibility may be restricted to seniors qualifying as lower income.
Deferred loan programs often have very low (even zero) closing costs and interest rates. This which makes them an alternative worth looking into before deciding on a reverse mortgage. To find out what deferred loan payment programs are available in your area, contact the Area Agency on Aging (AAA) for your region (http://www.eldercare.gov/Eldercare/Public/Home.asp).
7. Other Assets – Home equity should be viewed as a financial asset on par with CDs, stocks, bonds, cash-value insurance policies or other investments you may own. Before deciding to “cash out” home equity with a reverse mortgage, compare this strategy to other possibilities like selling other financial assets you may own. Stocks and bonds can be turned into cash much more efficiently than home equity can.
Deciding whether to take out a reverse mortgage is an important financial step for both you and you heirs. Be sure to consider the alternatives before making a final decision.

All you Need to Know About the Aarp Reverse Mortgage Page

Do you wonder if a reverse mortgage is the right choice for you? Do you know exactly what a reverse mortgage is? Do you know how to find out more information on a reverse mortgage? These are just a few questions that a lot of people may have about reverse mortgages. The good news is that these questions and more can be answered through the AARP reverse mortgage information page. This webpage can give you the tools that you need to make an informed decision on reverse mortgages. Read on to discover the kind of useful information that you will find on the AARP reverse mortgage page.

The very first thing you will discover is the definition of a reverse mortgage. You should read this carefully so that you are fully aware of what a reverse mortgage is. The more informed that you become the easier it will be to make an intelligent decision. Don’t depend on other people to tell you what you should do, research for yourself.

Another thing that you will find on the AARP reverse mortgage page is an explanation of how a reverse mortgage works. This is a great explanation that is written in plain English and very easy to understand. This will help you become aware of what you are getting into when you apply for a reverse mortgage.

Do you wonder if you are eligible for a reverse mortgage? The AARP reverse mortgage page will give you the information that you need to find out if you are eligible. It will also tell you if your type of home is not eligible. Having this information will save you a lot of time and stress.

A great feature on the AARP reverse mortgage page is the explanation of how you can receive the reverse mortgage payment. Some programs will give you a lump sum, some will give you a monthly cash advance and some programs are set up to do a credit line where you decide how money you want each month. It also will tell you which program gives the largest cash advances.

Be careful when choosing which reverse mortgage program to work with. Some programs will tell you what you can do with the money. For example, some federal programs will only allow you to use the money for home repairs.

The AARP reverse mortgage page will also give you good advice on what you will pay when you get a reverse mortgage. This page will reveal to you who the cheapest lender of a reverse mortgage is in the private sector. Read this carefully to save yourself a ton of money.

As you can see, there is a ton of helpful information on the AARP reverse mortgage webpage. If you are thinking about getting reverse mortgage, study all the information on this page before you make your decision. It will save you a ton of money in the long run.

Live Life Proudly With Annuity Reverse Mortgage

Annuity reverse mortgage is different from the regular mortgages and is getting popular with various investors. It offers more benefits in comparison to other financial plans. This mortgage lets the senior citizen to borrow money against the equity in home. Therefore, grab it for large benefits.

Advantage attached with annuity reverse mortgage is that the balance of loan decreases with the time. This is because the borrower is able to pay back the amount regularly. Moreover, the receiver or the borrower receives money for the equity that is in his or her house. However, an annuity reverse mortgage should not be confused with a home equity loan or home equity line of credit, as they both are ways of getting money for the equity in a home. By following either of these, the receiver can pay at least the monthly interest on the loan amount, or the amount that has been drawn from equity line. Although, a reverse mortgage client does not have to pay anything until the loan is paid off. There are various types of annuity reverse mortgages available that are quite expensive in comparison to conventional kind of mortgages. Well, this offers more benefits to the insured person. This loan can be received in a form of lump sum or monthly installments.

The annuity reverse mortgages are offered in various types by state or local governments commonly referred as single purpose reverse mortgages. These annuity reverse mortgages are less expensive in comparison to the regular ones. However, they impose restriction on various aspects like how the money will be distributed or will be used by the borrower. The other kind is federally insured home equity conversion mortgage. This annuity mortgage is a bit higher when compared to other private sector reverse mortgages. The third type of loan is provided by private sector or proprietary reverse annuity mortgages.

One can say that all these annuity reverse mortgages include charge origination fees and closing costs. Therefore, if the person seeking annuity reverse mortgage is still unsure, then it is he or she should hire a professional from a reverse mortgage firm who can guide him on the information and the intricacies involved in them just to avoid any hassles in future. In fact, it is advisable to work on information with the professional as will benefit the borrower in long-term and if the borrowers acquires perfect information on annuity reverse mortgage then the firm or the lender will not be able to trouble or misguide him. Just like traditional or regular reverse mortgages, an annuity mortgage has to be paid when the owner of the property dies, or the homeowner sells the home or has permanently relocated himself out of the country or native place. Well, there are default conditions also attached to this loan and can hamper the application or even make him ineligible for the loan if the person found out to be bankrupt, fraud and even misrepresentation by the applicant. So be rest assured and apply for an annuity reverse mortgage immediately.

Aarp Reverse Mortgage is a Respite to Senior Citizens Seeking Loan

Old age is referred as the golden period of one’s life but still no one wants to go through it. In addition, one cannot avoid it too, as it is associated with health hazards and financial trauma apart from happiness. One can see senior citizens looking for some financial assistance from various creditors or even family and friends, and end up paying more than what they should be paying. Well not any more, as AARP reverse mortgage is one such financial solution that reinstates the lost smile and puts the senior citizen back on the move.

What is a reverse mortgage and how can it help me in procuring a loan, is the first question that comes in the mind of a senior citizen who is seeking a loan against property? Well AARP reverse mortgage is a special kind of a loan that is available to equity-rich senior owners. In this kind of service, repayment is not necessary until the borrower sells the property or moves into a retirement home or somewhere else. One can also say that AARP reverse mortgage is a tax-free loan for homeowners whose mortgage has already been paid, but want to use the equity in their homes. In fact, a real definition of AARP reverse mortgage is that a lender makes periodic payments to the borrower using his or her equity in the home as a security.

Though one has to be very careful when choosing an AARP reverse mortgage loan, as they are readily available on the web. AARP reverse mortgage offers various types of loans, such as single-purpose, federally insured, and proprietary and covers the benefits and drawbacks of each. But one has to consider many things when applying for AARP reverse mortgage like how it will affect the financial situation of a senior citizen and how can she or he evaluate the property carefully in order to make an informed, wise decision to obtain a reverse mortgage. For this, AARP reverse mortgage offers counseling to its clients on the credit involved. The borrower receives the loan in a form of lump sum, line of credit and fixed monthly payment.

In fact, to be eligible for reverse mortgages, one has to own a house and should be 62 years old or more than that. The benefits involved in AARP reverse mortgage are that the senior citizen does not have to pay the amount in one go, or even on monthly basis. Above all, the senior citizen who has qualified the AARP reverse mortgage loans does not even have to procure an income proof or a receipt. Moreover, AARP reverse mortgage also offers discounts and other benefits on health care, automobiles, legal and other loans. In fact, the members or the borrowers are also eligible for general insurance services that are offered by AARP reverse mortgage service providers. In addition, the investigation involved during the crediting of loan takes less time. Hence, if you are looking for the right reverse mortgage loan then, you know where to approach

Stay With Reverse Mortgage San Diego Through Thick and Thin

We all are aware of home, travel, automotive and personal loans, as well as mortgages on various movable and immovable properties. However, have you ever heard or came across the reverse mortgage. What is a reverse mortgage? Well reverse mortgage San Diego is one such loan that brings back the lost smile of people who do not want to take loans from family and friends or even from banks or creditors.

At some point of life, one may have the urge of selling his or her property, but not now, with the help of reverse mortgage San Diego one does not have to worry about losing one’s home anymore. Reverse mortgage San Diego offers services with a touch of humanity. The first question that strikes any body’s mind is what is a reverse mortgage San Diego? In addition, how can it be helpful to me in my needy days? Well reverse mortgage San Diego is a special kind of a financial service that is available to equity-rich senior citizens of San Diego. Reverse mortgage San Diego provides an opportunity to senior citizens with a repayment service that is not necessary until the borrower sells the property or moves into somewhere. In fact, as the loan suggests, it can be called a tax-free loan for homeowners. Reverse mortgage San Diego enables debtors, whose loans are paid and still wants to use the equity of his house. One can say that a reverse mortgage makes periodic payments to the borrower using his or her equity in the home as a security.

Well with a reverse mortgage San Diego, one can feel easy while applying for a loan against mortgaged property. In fact, reverse mortgage San Diego offers a variety of loans, such as single-purpose, federally insured, and proprietary and covers the benefits, as well as offers drawbacks of each loan- the person has applied for. However, one has to take many things under consideration when applying for reverse mortgage, such as how will it help a financial situation of elderly citizens and how they evaluate the property carefully in order to avoid fraud or any other mishappening. In order to make an informed, wise decision to obtain a loan, reverse mortgage San Diego offers and conducts counseling to its clients on the credit involved. The best part of reverse mortgage San Diego is that it offers borrowers the loan in a form of lump sum, line of credit and fixed monthly payment.

These days, many senior citizens use reverse mortgage San Diego to supplement social security, to meet unexpected medical payments, home improvements and sometimes even for buying an automobile. Reverse mortgage San Diego is gaining popularity amongst various citizens of United States of America, as it provides an opportunity to live with pride and restores their long lost smile that they used to be proud of. Reverse mortgage San Diego offers loan to people who have completed 62 years or are above it. With reverse mortgage San Diego, one does not have to pay back loan in one go instead can pay it in monthly installments. In addition, reverse mortgage San Diego offers special discounts on general insurance and other medical services to its members or borrowers.

The Advantages Of Reverse Mortgages

In recent years property values have soared, while investment returns have been modest. This has created a situation where a lot of seniors are finding themselves in the position of being house rich and cash poor. These cash strapped seniors are looking for ways to increase their retirement income while continuing to live in their homes. These retirees find that their options are limited, and in most cases require them to risk their home. Enter the reverse mortgage, which can provide many advantages over these other less desirable options.No Payments With Reverse MortgagesThe biggest advantage of a reverse mortgages is not having to make payments as long as you continue living in your home. In fact, this is the number one reason that seniors choose to borrow reverse mortgages. Almost 80% of reverse mortgage borrowers use a reverse mortgage to pay off their current loans in order to eliminate their house payments. Let’s say you owe $50,000 on your first mortgage and borrow $80,000 with a reverse mortgage. This would pay off and eliminate the payment on the first mortgage and provide you with $30,000 to use as you please.Live in Your Home as Long as You LikeThe second advantage of reverse mortgages is the ability to live in your house as long as you like. The great thing about this is the amount you owe on the reverse mortgage can never be more than the house is worth. Let’s say you live to 115 and have selected to recieve a $300 a month payments for life from the reverse mortgage. The amount received from the reverse mortgage payments could be substantially higher than the value of your home, yet the amount owed will still only be the value of the home. In this situation, FHA insurance will cover the difference.Reverse Mortgage Withdrawal OptionsAnother advantage of reverse mortgages is the different withdrawal options that a you are able to choose. These options include lump sum distributions, line of credit, monthly payments, or any combination of these three. So if you were eligible to borrow $100,000 on a reverse mortgage you could select to receive $30,000 up front to cover current expenses, and hold the rest as a line of credit that you can use whenever you need it. This flexibility of reverse mortgages can significantly improve you financial independence during retirement.Tax-Free Nature of Reverse MortgagesAnother advantage of reverse mortgage is the tax-free nature of the loan proceeds. The American Bar Association guide to reverse mortgages advises that generally the IRS does not consider loan advances to be income. This means that all the money from the proceeds of the reverse mortgage end up in your pocket.With these features, reverse mortgage are definitely an option to consider if you are looking for ways to supplement your current income. As with any financial decision, you should seek the advice of a trained professional, a reverse mortgage counselor, to evaluate and determine if a reverse mortgage is right for your situation.

Frequently Asked Questions About Reverse Mortgages

Reverse mortgages are an exciting and fast growing way for seniors 62 and older to keep their property and tap their equity to improve cash flow. Many people have questions about reverse mortgages and here are some common questions and answers.
What is a reverse mortgage?
A reverse mortgage is a loan for seniors 62 and older to tap their equity in their home. They do not make any payments on the loan until the house is sold.
Who qualifies for a reverse mortgage?
To qualify for a reverse mortgage, you need to be at least 62 years old and own the property free and clear or have a very small mortgage balance. Unlike traditional mortgages, credit and income is not considered for reverse mortgage eligibility.
How do I get my money?
This is up to you. It’s your equity. The only requirement is that any outstanding lien (mortgage or other debt against the home) on the property must be paid in full at the time the reverse mortgage is done. You can take the remainder of your reverse mortgage funds as a lump sum, line of credit or monthly payments. And the best part of all is, you can take any combination of these choices- some money as a lump sum to perhaps pay off bills, some as a line of credit to meet future needs, and some as a monthly amount to supplement your current income. You can even change your mind down the road- it’s your equity, it’s your choice.
What are some things that I can do with a reverse mortgage?
You can do anything you want with the proceeds as long as you pay off any liens against your home. Once that is done, the funds from a reverse mortgage can be used for virtually any purpose- supplement your current income, pay off bills, home improvement, travel, the list is virtually endless.
Why don’t I just sell my home?
Sometimes, that may be the best solution. A good loan officer will answer all your questions about a reverse mortgage and then let you decide. However, if you sell your home, where will you live? You also need to consider the costs associated with the sale.
When does the reverse mortgage become due?
Once the home is no longer your residence, the loan becomes due. Depending on the situation, you may decide to have children or other heirs sell the home, or if they want to keep the property, they will need to pay off the reverse mortgage either with their own funds, or by obtaining a regular or “forward” mortgage. In any case, a reverse mortgage is an FHA insured “Non Recourse” loan which means that you will never owe more than the property is worth. Of course, any remaining proceeds after the sale of the home will go to you or your heirs. This is a very safe and highly regulated financial product.
How can I find out how much money I qualify for?
This depends on your age, the property value and the amount currently owed. The best way to find this out is to contact your loan officer or use the calculator on the AARP website.
As you can see, reverse mortgages are here to stay. For more information about reverse mortgages and to see if they are right for you, contact your loan officer.

Steps to Getting a Reverse Mortgage

Here are a few of the steps you’ll want to go through to get started with a reverse mortgage. Keep in mind that these types of loans are not necessarily for everybody, but they can be a great source of funding when seniors are in need of additional income.
1. Becoming Aware: Because reverse mortgages are relatively new, there are a lot of people that don’t know much about them. Although the media including newspaper, tv, radio, etc. are reporting more on stories about reverse mortgages, there are still a lot of misconceptions and misunderstanding. People learn about reverse mortgages through the news, articles in the newspaper, magazines and other medium including word-of-mouth.
2. Get Educated: Homeowners find out additional details from a reverse mortgage lender or use tools like the internet to get more details on reverse mortgages. The National Reverse Mortgage Lenders Association may also have some insight into reverse mortgage lenders in your area.
3. Independent Counseling: Before being able to be approved for a reverse mortgage, the borrower will need to work with independent counselors through either the AARP or through a local HUD-approved counseling agency. This counseling can be done in person or over the phone. Counselors will review other options including housing, social services, health and financial alternatives as well as other home equity conversion options including property tax deferral. The counselors will also discuss the financial implications of a transaction like this and the potential consequences including tax liabilities.
4. Application Process: Homeowners will then work with their loan officers to complete an application and choose their payment plan in the form of either a lump sum or monthly payments, a line of credit, or a combination of all three. The lender will disclose all of the details about the loan and the loan amount and all estimated costs as dictated by the federal truth in lending act. The application will also include verification data including social security information, deed to the home, information on existing mortgage (if any), and counseling certificate.
5. Processing: The lender will order an appraisal of the home to determine the value and the appraiser will also make sure the home meets the FHA guidelines for the physical condition of the home. Repairs may be required if any component of the home doesn’t meet the guidelines for the physical condition of the home. Repairs are the responsibility of the homeowner and any expenses occurred in this case are the responsibility of the homeowner as well.
6. Underwriting: Once the application and all necessary paperwork required to accompany the application are submitted, the process of underwriting the loan begins. By this time, the loan parameters have been agreed to by the lender as well as the borrower and include things like payment options, frequency of loan interest rate adjustments, and loan amounts. The underwriting process takes about 4-8 weeks to underwrite the loan package. Some underwriting may be done faster, some slower.
7. Closing: Once the loan is approved through the underwriting process, the closing is scheduled. Interest rates are calculated at this point and the closing documents and final numbers are prepared. Most costs, if not all costs may be financed as a part of the loan. The homeowners are required at this point to sign the loan papers.
8. Disbursement: Following the closing of the loan, the homeowner has a 3-day right of rescission. This means the homeowner can cancel the loan within those three days without penalty. Once this 3-day right of rescission has passed, the funds from the loan are dispersed. Depending on the method of payment selected by the homeowner, the funds are then dispersed or made available. Any existing debt on the home at this point is paid off and a new lien is placed on the home. The homeowner at this point may use those funds for any purpose.
9. Repayment: Homeowners aren’t required to pay any mortgage payments or repay the reverse mortgage until they cease to occupy the home as their principal residence. The reverse mortgage may be repaid by the homeowner or the heirs or by the estate. This repayment doesn’t require the sale of the home. The repayment obligation of mortgage can be taken care of by a traditional refinance as well. The loan amount or repayment obligation can’t exceed the home’s value or sales price.
These are the main . Seniors age 62 and older can apply for and get approved for this type of loan. Reverse mortgages aren’t for everybody, but if you are in a position to need income beyond retirement, the reverse mortgage may be a very good option. How much you’ll get will depend on your age as well as the equity and value of the home. Plan on speaking with a counselor as well as a loan officer prior to getting a reverse mortgage. Research will be a valuable tool when making a decision involving perhaps your most valuable possession.

Should You Consider a Reverse Mortgage

Reverse mortgages are mortgages where the lender pays the borrower instead of the other way around. In the event of reverse mortgages, seniors need only be 62 years or older with equity in their home.
There are no requirements like credit score or income or anything else. Basically seniors with equity in their home and over the age of 62 can qualify.
Reverse mortgages require you to get counseling from a 3rd party advisor on whether or not a reverse mortgage is right for you. This mandated counseling is to specifically prevent seniors from being taken advantage of.
One of the main questions is what these funds from a reverse mortgage can be used for. Reverse mortgages funds can be used for anything including paying off an existing mortgage, traveling, home improvements, or simply enhancing the standard of living.
There are several websites that discuss reverse mortgages and provide details for seniors. Getting started with a reverse mortgage is usually done with a competent loan officer that can give you details, tell you how much you can qualify for and provide some insight into whether or not a reverse mortgage is right for you.
After this initial conversation with a reverse mortgage broker or loan officer, you will then need to proceed with either the paperwork or the required counseling with a 3rd party. Your loan officer will provide you with a list of counselors you can communicate with to discuss the reverse mortgage, your financial situation and alternatives.
This is the basic place to get started. You can find reverse mortgage lenders by searching on the internet or contacting local mortgage brokers in your area.
Reverse mortgages aren’t for everybody, but they can be used successfully to assist seniors who may be living paycheck to paycheck.
Many seniors choose to use this reverse mortgage to pay off an existing mortgage. You should inquire as to whether or not you’ll be able to do this or to use the mortgage to purchase a new home with a single transaction.
The great part about a reverse mortgage is that it can be a tool to aid in retirement not only for seniors having a difficult time with their finances, but also for seniors who are looking to take that trip they’ve always wanted to take or visit the grandkids more often.
Some seniors use this reverse mortgage to increase the equity in the home through home improvements as well which can put them in a better situation to refinance the home if they’ll be leaving it to their heirs or an estate.

Reverse Mortgage for Senior How to Know if a Reverse Mortgage is Right for You in 2 Steps

Reverse Mortgage for senior continue to grow in popularity among seniors, primarily due to rising cost of living. Researchers seek to uncover the national view on reverse mortgage, to determined how effective a reverse mortgage can be in financially assisting seniors in their retirement years.

According to a research conducted by the National Council on Aging, approximately 97% of the population aged 65 and beyond desire to remain independent in their home after retirement. This continues to be the biggest concern for this age group in planning for retirement.

The thought of independence is at the very core of what this country was established upon, and is woven into the fabric of the American society. However, with the cost of living soaring to record heights, independence for many seniors may not be an option, unless they are able to unlock the financial power in their homes through a reverse mortgage.

Lets take a closer look.

To some the thought of independence after retirement is a lofty goal, while for the overwhelming majority, being independent is the only way that they want to go on living.

The first step to determining if you will able to make this latter dream a reality is to determined if your current expenses fall within your monthly or annual budget.

Next determine a comfortable amount that you will be able to set aside for unexpected financial burdens which may arise.

Here are a list of possible occurrences that will require monetary attention:

Health problems

Medicare co-payments

Prescription drugs

Hiring a caretaker

Car issues

Home improvement needs

Just to name a few.

While there are many services who specialize in catering to seniors to make their dream of independence after retirement a reality, these services in most cases require a financial commitment, adding even more strain on seniors finances.

A reverse mortgage could prove to be the best solution for seniors who have plenty of equity in their homes and little savings to handle their day to day living expenses. Since a reverse mortgage does not require any monthly payments, the money which seniors receive does not create any new financial obligations.

With the use of a reverse mortgage seniors may have the financial power to remain independent in their homes while enjoying their retirement years.

Seniors should seek out professional advice from a reverse mortgage expert, who can give them all the information about reverse mortgages to help them make the most effective and informed decision. A reverse mortgage can prove to be the added financial resource to give seniors the sense of freedom from the financial woes which accompany so many people today.

Is It a Good Time for a Reverse Mortgage?

As industry professionals, we often have an opportunity to sit in on conference calls on market trends and other things that affect reverse mortgages and the senior borrowers who get them. We were on one today that echoed something that we have been saying so it seems that it’s to a point where we should pass this information on to everyone.
Reverse Mortgages have gained in popularity but it seems that there has been an increasing amount of negative press lately and many senior borrowers have become hesitant to consider this financing tool available to borrowers age 62 and older. Is a Reverse Mortgage a safe loan and is now a good time to get one? Those are two questions we hear all the time and we say ABSOLUTELY to both!
seniors may purchase home with reverse mortgage With regard to the safety and all the negative press as of late, the reverse mortgage is probably the safest loan available to any borrower at any age even though it is available only to borrowers age 62 and above. The borrowers must obtain third-party counseling and should have their family members and/or trusted financial advisors involved in the entire process.
As is the case with anything in which people are involved, there is a possibility that someone, somewhere, will try to take advantage of others. However, every article I’ve read so far about abuse related to reverse mortgages, were centered around one of two things; either the person originating the reverse mortgage was selling another product to relieve the senior homeowner of their reverse mortgage funds, or someone felt the proceeds did not benefit the borrower enough for the fees they had to pay.
This is why we say that the family and financial advisors of the borrowers should also be involved in the process. Do not to obtain your reverse mortgage from anyone selling other products.
Also, some of the press is not deserved and misreported. One of the closing statements that was recently brought to me by the son of a reverse mortgage borrower who was livid because his father paid what he felt was way too much in fees to only get $37,000 in cash (actually, a line of credit).
At first I felt that he may be correct, reverse mortgage fees with the mortgage insurance premiums, etc can be high so I thought that $37,000 sounded very low and maybe not worth the investment until I saw that his father also paid off a $156,000 existing lien on his home that was a higher interest rate and he was making a mortgage payment of over $1,025.00 per month that he really could not afford.
This was another deal that the press could have had a field day with if they only reported that he paid $15,000 in total costs to receive $37,000 without taking into consideration that he paid off his existing debt and never had to make another payment for life and he now had a line of credit in the amount of $37,000 available to him for his use.
As to the second question regarding whether or not now is a good time. Now is an excellent time. Aside from the borrower’s age and the property location, the other factors that determine how much money borrowers can receive on their reverse mortgage are the property’s value and the interest rates. Property values have been declining for a while now and are projected to continue to go down at least through the end of 2008.
Now is the perfect opportunity to make the most of the property’s value before they fall to a lower level and the borrower does not qualify for as much money. And then there is the interest rate part of the equation. The fully indexed rate for a HUD HECM is below 5% which means that the borrower will receive the maximum amount of cash available under the program.
The bottom line is that now is the best possible time to get a reverse mortgage and borrowers and family members should take a good look at their options. If you have been holding back because of an article you read with some horror story, consider the circumstances and make sure you have the safeguards in place.
Don’t let uninformed or biased reporters or authors push you one way or the other, take a good look and see if it’s right for you and if it is, now is a great time to be a reverse mortgage borrower!

Soothe your Queries With Aarp Reverse Mortgage

Is reverse mortgage a sensible step? How to deal with reverse mortgage? What are the objectives that have to be focused if opting for reverse mortgage? These and many more questions bubble in your mind on talking about reverse mortgages. But very few of us actually know the exact place to look out for these answers because incorrect or half information can bring out a confusing conclusion. And the questions remain at the same status with no valid assurance. The main reason for receiving half information about the mortgages is the hidden prospects of mortgage policies. American association of retired persons or commonly known as the AARP reverse mortgage has no such hurdles. The have simplified set of terms and regulations for providing basic required information.

AARP reverse mortgage has a motive of helping out people who are above 62 years of age. It is basically a financial plan to support senior citizens economically after their retirement. As the monthly income stops after retirement, many people find it difficult to balance their expenses with definite amount of pension and other income resources. The scheme is already well established and highly acknowledged by the people of America. However, the benefits coming from AARP reverse mortgage are unbeatable and greatly rewarding. According to the government every person must seek some valuable informative counseling before selecting any reverse mortgage loan plan and schemes. This can be easily done by meeting the members of AARP. Around one third of total American senior citizens are linked with American association of retired person and all the members are entitled to receive free counseling, which can guide them in understanding the entire idea of reverse mortgage in a more appropriate manner, so that they can make wise decision fetching enough benefits.

There are certain norms and rules to be applicable for a reverse mortgage loan. AARP reverse mortgage can thoroughly guide you on these terms. The most important among them is that the applicant must own a house because the complete dealing of financial transitions are settled on that basis with the broker. On taking the reverse mortgage loan, the amount of payment that the applicant is supposed to get in the form of loan is decided by the equity of his house and other such factors. An added advantage is the fact that you do no have to pay any tax on the money you get through the reverse mortgage. However, still the most prominent thing about it that overcomes all other features is that no repayment of the loan money has to be done. After the death of the person who has taken the loan, the broker reimburses the amount by the auction of the house instead of transferring the toll on their heir.

The AARP reverse mortgage page offer you a detail study about the ways in which you can receive your money from reverse mortgage. There are several schemes, according to which you can get the entire amount in one go or in monthly installments. There are few programs that present to you a credit line through which you can fix your monthly income.

Reverse Mortgages and Their Growing Popularity

There seems to be a new phenomenon in the mortgage world known as the reverse mortgage. The ads touting how they can improve quality of life are everywhere and if you’re a homeowner, age 62 and over, you receive them in the mail almost daily. Then there are the articles warning that reverse mortgages may be the new mortgage rip off. So what’s the truth about this financing vehicle? Is it a God-send for seniors, or something for which older homeowners need to be wary? It can actually be both, so it pays to understand the loan if you or a loved one are contemplating a reverse mortgage.
Reverse mortgages have been around since 1961 and President Reagan signed the legislation to allow HUD to insure them in 1988 on their Home Equity Conversion Mortgage (HECM). So why the sudden stir and what makes this mortgage so unique? The baby boomer population that we’ve all been hearing that is about to start retiring, begins to do so as of January 1, 2008. What this means is that America will have an unprecedented number of people retiring with many having their main asset being their homes.
Gone are the days of the American worker working to the age of 62, retiring with a pension and social security, then passing by age 70. People are living longer and fewer are retiring with adequate income provided to meet their life needs. The huge appreciation most properties have experienced allows seniors an avenue to augment this growing need for income. A traditional or a forward mortgage, is known as rising equity, falling debt mortgage. The individual pays a payment monthly to pay down the debt thus making the equity higher and the debt lower.
The reverse mortgage operates in reverse of that. In a reverse mortgage, the borrower receives payment(s) from the lender, makes no monthly payments and the debt rises while the equity falls as payments, fees and interest accumulate. The borrowers make no monthly payments and the entire amount is paid in full when the loan is repaid.
Income and credit are not considered in qualification criteria, with the exception of the fact that the borrower cannot be delinquent on a federal obligation. There is no minimum income requirement and there are no minimum credit scores. In fact, many borrowers have been saved from foreclosure with a reverse mortgage. There have been so many myths and misconceptions surrounding reverse mortgages.
Some earlier versions of the product contained provisions for shared appreciation which hurt seniors, but those provisions are not in the HUD HECM loans. All of the government loans are also non-recourse loans, which means that the borrowers or their heirs can never owe more than the property is worth, regardless of how long they live in the home, how much they receive in payments through the years, what future values do or how much interest accumulates.
A reverse mortgage loan can be expensive, so it’s not the best option is you are not planning on using the loan, or do not plan to stay in the property. On the other hand, for some, the reverse mortgage is the only way they are able to stay in their homes. The bottom line is EDUCATION. Find an originator who really knows and understands the product. There are so many programs available now and some private or proprietary products that go down to 60 years of age and lower.
You need to work with an expert, not just a loan officer from a brokerage or a bank who was doing sub-prime loans last month and is doing reverse mortgages this month. Unlike forward mortgages, fees and rates are regulated by HUD so everyone is on an even playing field, and companies like All Reverse Mortgage Company often have many more programs available to us as we are not limited only to just the few products that just one bank has to offer. Lastly, talk to your family.
You’re spending the equity that would normally be the inheritance left to other family members and this can be an area of concern more often to the senior homeowner than to the family members themselves. Most family members we’ve talked to don’t have the means to take care of their own family expenses as well as those of their parents and senior relatives, so they are extremely happy that their loved ones have a way to age in place and dignity.

Accelerate the Pace of Life With Reverse Mortgage Lender

Money plays a crucial role in building and strengthening lives. However, the other true fact that is associated with life is the golden age and believe it or not, it is one of the most testing periods of one’s life and God forbid, if one suffers from the financial woes in this age then it is a set back for him. It also means that life can play a cruel role even though one has always led a life of a king. However, if you are a senior citizen and are in a dire need of good amount of money, then reverse mortgage lender is a final destination and perhaps a ray of hope for you. Thus, do not hesitate and approach a lender for a secured and wealthy future.

The money offered by the reverse mortgage lender can be utilized for many purposes like health care, house renovation, vacation, and automobile or for various other personal needs. Therefore, applying for a reverse mortgage from a lender is an excellent idea to accelerate the pace of life smoothly. Senior citizens residing anywhere in the United States can rely upon reverse mortgage for intact and reliable future. However, you have to fulfill some basic but significant information to the lender for a secured life. These terms and conditions are easy to follow and fill. All that a senior citizen has to do for a reverse mortgage loan is that he or she should be above 62 years and own a high valued residential asset. However, the borrower need not pay the loan amount till the time he or she is alive, this way the borrower is able to retain the house also. In case, the house is sold or the person residing in it moves to somewhere else, then only the property will be mortgaged by the lender.

Well, it has been noticed that not many elder citizens are aware of the terms and conditions related to reverse mortgages. This is the reason that many of the senior citizens turn toward reverse mortgage lender for a better and comprehensive understanding of the terms. However, the best thing about a lender is that the borrower does not have to pay any interest on the taken loan, as it will be deducted from the realized cost of the property or a house. Normally, repayment period of regular mortgage is 30 years, but reverse mortgage loan can be repaid in a form of a monthly installment. Therefore, reverse mortgage lender assures senior citizens with instant finance and that too in a lesser period of time in comparison to other regular mortgages. He understands the intensity of the need, hence, if you are planning to go for reverse mortgage then do a detailed market research before making any decision. In fact, involve the lender and compare as many plans as you can before settling for any. It is advisable to choose a plan according to the requirement, for instance, you need a loan for home repairing then the best option will be the single purpose loan from reverse mortgage lender. And lastly thoroughly read all terms and conditions to avoid frauds.

Live a Blessed Life Through Reverse Mortgage Canada

Just like various other financial plans and programs, reverse mortgages are also catching up with people who are attaining or are already retired. In fact, these programs are quite popular in the United States and are offered under different categories based on the regional demarcations. In addition, one such plan on the offing is reverse mortgage Canada. This plan helps as it offers them a financial security.

Well, as everyone knows that reverse mortgages are a kind of loan, where the lender pays the monthly installments to the loan seeker, instead of letting the seeker pay the amount to him. Studies show that over two hundred thousand people have already used reverse mortgage Canada to elevate their life after retirement. It is a government sponsored and insured loan that requires no payments until the person is residing in his or her house. Moreover, this loan enables homeowners to access the money they have built up as equity in their houses. Hence, the name reverse mortgage is aptly adopted by various financial agencies as the payment stream is reversed. It enables senior citizens to convert their home equity into tax-free income. However, the reverse mortgage Canada is designed to strengthen seniors’ personal and financial independence by offering funds without a monthly payment during their lifetime in their homes.

The lender pays the amount of the home equity in a form of a lump sum, in a stream of payments, or as a supplement to social security or other retirement funds. However, not every senior citizen is eligible for reverse mortgage Canada. The applicant must be at least 62 years of age, owns, and occupies a home as their personal residence. The owner should have a single-family residence, town home, condominium, multiple unit building, or mobile homes with a permanent foundation. However, unlike a conventional home equity loan or second mortgage, no repayment is required for the reverse mortgage until the borrowers no longer use the home as their principal residence. The other basic difference between a reverse mortgage in Canada loan and a bank home equity loan is that with a traditional second mortgage or a home equity line of credit, the debtor should have sufficient income to qualify for the loan and he or she is required to make monthly mortgage payments.

The benefits involved in a reverse mortgage in Canada could be that ownership of home can be retained for life. The remaining equity will be passed on to heirs; proceeds from reverse mortgages Canada are tax-free. And can be used for many things like home care, repairs and improvements, paying off an existing mortgage, education of grandchildren, hospital and health care costs, paying off taxes and credit card debt, buying a second home, and vacation. Hence, let your home pay you back! In reverse mortgage, no loan repayment or payments as long as the person lives in their houses is required. In fact, there is no income, medical or credit requirements to be fulfilled. This is also available in federally insured, lender insured and uninsured reverse mortgages.

Get the Best Reverse Mortgage Rate

When you are down in the dumps, as you have no money to spend, it can really lift your spirit if you come across a financial plan that can help you take care of this. If you are young and have a regular income, probably you will not be thinking about any of these financial plans. However, the real worry beings when one retires from work as the regular flow of income stops but the wants and needs remains the same. Making all the plans to take care of your finance after retirement is something that you must plan out now and do not leave it for the last moment. In such a scenario, taking a reverse mortgage loan is the best way out for you. A reverse mortgage loan is a financial settlement where a senior citizen can get loan in lieu of the house that he owns. Brokers offer different reverse mortgage rates for the house; you can approach and deal with the broker who gives you the best rates.

To get a reverse mortgage loan in the United States a person must be 62 years or above and must own a house. The best part about taking a reverse mortgage loan is that even if the person dies, the burden of repaying the loan does not fall on the heirs. In such a scenario, the broker easily realizes the loan amount by selling off the house. The senior citizen will not have to repay the loan amount until the time he is staying in the house, but if he decides to sell off the house, then the loan amount needs to be paid back. If you have any queries about the whole reverse mortgage and reverse mortgage rate thing, you can put up your queries to AARP. The American Association of Retired Persons has been set up especially to help senior citizens lead a better life after retirement. All your reverse mortgage rate related queries will be answered by them.

Reverse mortgage rates can vary from state to state, so it will be better for you if you find out the rates in your state before taking a reverse mortgage loan. In addition, you must be cautious about a number of fraud dealers operating. They may offer you the best reverse mortgage rates, but in the end, you may end up losing your house and perhaps you will also not get the loan that you want to take. You must be ware of such reverse mortgage brokers and it is always better if you deal with someone who is reputed. Remember to check the credentials of the broker before you decide to deal with him to take the reverse mortgage loan. This is a hassle free means by which you can arrange for money that you will require after you retire form work.

Do not make the deal with the first broker that you come across. Survey the market carefully and find out the reverse mortgage rates offered by the other brokers. You will find that by doing this you can actually find out very good reverse mortgage rates to make the deal.

Aarp Reverse Mortgage: Lead a Hassle Free Retired Life

Aarp is the American association of retired person, which aims at helping out people over the age of 50 years, to enhance their life after retirement. Life after retirement can get really difficult money wise, if the senior person does not have provisions to take care of all his monetary needs. Aarp reverse mortgage is a financial scheme that is very popular among the senior citizens in America. Basically the Aarp reverse mortgage supplements the income of the retired person so that he can lead an independent life, even after retirement. When a person retires from work, the monthly flow of money stops but the needs and requirements of that person and his family remains the same and hence they face a shortage of money. There are lots of benefits associated with taking a reverse mortgage loan and so this trend is becoming popular day by day.

It is understandable that you may be worried whether a reverse mortgage is ideal for you or not. The government also requires that, every senior citizen take a credit counseling class before applying for a reverse mortgage loan and for this you can get all the help you want from Aarp. More than 75% of retired Americans are members of the American association of retired person and this counseling is offered by the agency free of cost, to all its current members. The counseling can help you in understanding the whole concept of reverse mortgage in a better way and also in making a wise decision of opting to take a reverse mortgage loan. You can get to know the whole process of how to apply for the loan and how the whole thing will be processed.

To be eligible for a reverse mortgage loan, a senior citizen must own a house. The whole financial transition is made with a broker on the basis that, the person seeking this loan, owns a house. The amount of money that one can get as loan through the reverse mortgage loan depends on the total equity of the house, among other factors. The money obtained through a reverse mortgage loan is tax free, so there will not be any hassles while using the money for any purpose. The best part about taking a reverse mortgage loan is that, one does not need to repay the loan money. Even if the person who has taken the loan dies, the burden of repayment of the money does not fall on the heir. The broker gets back the money by selling off the house, which comes in his possession after the death of the owner.

However, if the owner decides to no longer stay in the house or to sell off his house, the senior citizen will have to repay the loan money. Only senior citizens above the age of 65 years of age are eligible for the Aarp reverse mortgage loan. The Aarp reverse mortgage counseling is something that you must take, if you want to make sure that you are fully informed about the whole process and method of taking a reverse mortgage loan.

Approach Reverse Mortgage Lender to Get ?low Risk High Gain? Loan

As old age comes with its own type of problems, one must be financially secure to deal with these problems. Since a person grows old, his financial resources start drying up; in such situation financial crises can pester him a lot. Borrowing money from any relative or friend can be pointless as after knowing that the borrower does not have any steady source of income except pension no one would like to lend money. In such scenario reverse mortgage is the only solution with regular income stream that can help in fulfilling intensive financial needs. Home is that single typical asset that every senior owns; a reverse mortgage lender offers you low risk and high gain loan against equity of that house property.

Every senior who owns a house or a portion in any house property, can approach reverse mortgage lender for getting money. Though the concept of reverse mortgage is very old but due to its high risk and fear of collapsing home it never got positive response of people. This entirely new version of reverse mortgage is poles apart from traditional reverse mortgage system and is capable enough to be preferred choice of every borrower without any fear. Current reverse mortgage lender companies are not only offering an excellent loan facility but also providing seniors with a source of income. Reverse mortgage providers are such financers that make it possible for senior to live with their principles and dignity even after getting retirement from profession.

Getting loan from any reverse mortgage lender is very simple; according to the rule, a house owner who has crossed 60 years of age can apply for reverse mortgage loan. Through this, he can get loan up to 60% of the values of his house asset along with privilege to stay there as long as he want. Moreover, the mortgagor will not be forced by the lender to repay the amount till a certain time period but in case the house owner is willing to sell his house property he will be liable to repay his loan first. In terms of repayment, the senior can opt for monthly, quarterly or yearly installment or as per his discretion. Consequent to revaluation necessary changes can be made to loan amount; for instance the more value of your home will increase the less you will have to repay to reverse mortgage lender. Factors, such as location and market value of the house property and age of borrower affect payment status of loan and can increase or decrease the amount of loan.

The most important advantage offered by the reverse mortgage lender is that despite mortgaging the house, the house owner can retain its ownership. The amount received from reverse mortgage will be considered as loan not as income, hence, it is non-taxable and do not put any tax burden on borrower. This regular monthly income can be helpful to seniors in fulfilling his day-to-day needs. Needless to say that reverse mortgage loan is extremely advantageous as it is helping numerous seniors in living a relaxed post retirement life.

Nevada Reverse Mortgage: Lead your Retired Life Smoothly

This may sound different, but a reverse mortgage is a loan which you can take against your house and you do not have to pay the loan till the time you continue living in that house. And if you continue to live in that house till the time you die, you do not even have to pay the money. Now this may sound very interesting to you and now you would surely like to get a reverse mortgage loan. That is understandable, but just remember that there are certain things that you need to fulfill to get the reverse mortgage loan. If you happen to reside in Nevada, you can get a Nevada reverse mortgage loan from several of the reverse mortgage loan brokers operating in your city. A reverse mortgage loan has been taken by several Americans, to take care of their monetary needs in lieu of the house that they own. In fact the number of people who are opting to take a reverse mortgage loan is rapidly increasingly.

First of all you need to possess a house in your name to get the Nevada reverse mortgage loan. The amount of money that you will get as a loan in lieu of your house depends on the equity of your house among many others. You need to be a senior citizen above the age of 62 years to be eligible for the loan. Once a person retires from service, it gets very difficult for him to maintain his standard of living and take care of his basic needs as his monthly flow of income stops. When we have the money we indulge in lots of luxuries which later on become a necessity for us. Now after retirement it gets very difficult to take care of these necessities as there is a shortage of money and this is where a reverse mortgage loan can help you out.

There are many reverse mortgage loan dealers operating in your city, so make sure that you do a little background research about the broker and find out if he is reliable or not. The reverse mortgage loan will not become a burden to you and it will not pass on to your heirs. If the owner of the house decides that he no longer wishes to stay in the house and wants to sell it off, then he will have to repay the loan that has been taken. If the owner dies then the loan is paid off by selling the house, here the house acts as collateral for the loan.

Statistics from the national Reverse Mortgage Lenders Association indicate that this industry has seen a tremendous amount of growth in the last few years. In the first quarter of 2007, there was more than $17 billion increase in the home equity of seniors and this has been largely due to reverse mortgage. Reverse mortgage has come as a boon to all those senior citizens who are in need of cash to take care of all their financial needs.

Reverse Mortgage Lender: Make a Wise Choice

Finance is one important aspect of our life and till the time one is earning and there is a regular flow of money, this is not at all an issue. However once a person attains the retirement age things becomes really difficult for him especially as the regular money flow stops. However there are ways through which even this can be easily overcome and reverse mortgage is one of them. A reverse mortgage is a loan that can be acquired by a senior citizen in lieu of his house. The amount of loan that one can get from a reverse mortgage money lender depends on the value of the house that the loan applicant owns. The house is the security for getting the money and the person who gets the loan does not have to move out of the house till he decides to sell his home or till his death.

Make sure that you work with a good reverse mortgage lender so that you do not face any kind of problem in that. The reverse mortgage lender will undoubtedly need to have a thorough knowledge about the rate of interest for the loan and also all the other nuances connected with this. When you are seeking a loan from the reverse mortgage loan provider you must make sure that you clarify all the doubts that may come to your mind. Keep asking him questions, there must not be a single doubt in your mind about the whole thing or this can cause problems for you. The amount of money that you can take for a reverse mortgage loan depends on the equity of the house and also on the existing rate in the market.

A reverse mortgage loan is different from a traditional mortgage loan in the sense that the person who takes the loan can continue to stay in the house till the time they deicide to sell the house. Finding out a reverse mortgage loan lender in your city is not a difficult thing for you to do. You can seek help from the local yellow pages and the internet. Today you can find local search facility available for all cities and this makes the whole process of locating a reverse mortgage lender all the more easier. Another important quality that you must look for in a reverse mortgage lender is his reliability. If you cannot fully trust and rely on your loan provider you will find it really difficult to work with that lender.

If at all you want any help about getting the reverse mortgage loan you can approach the National Reverse Mortgage Association. This association was set up with the sole purpose of protecting the interests of the senior citizens who are seeking for a reverse mortgage loan. To know about the lender all you need to do is visit the site of this association and therein put the name of the state where you are seeking the lender and you will come across several names. A reverse mortgage lender is just the right person who can help you out in acquiring a reverse mortgage loan.

How to Get the Best Reverse Mortgage Rates

As with your first home mortgage and all major purchases, you need to shop around when considering a reverse mortgage to ensure that you are getting the best rate available. Talk to your family and friends, use mortgage calculators online and preview rates on various websites to be well on your way to finding some great mortgage rates for your reverse mortgage.

Before you begin your search for the perfect reverse mortgage rates, you should determine what kind of reverse mortgage you want and that will work best for you. There are several options in payments such as taking a lump sum payment or monthly payments. It is important that you know all the details to know what will be in your best interests. For example, if you take your payment as a lump sum you will not be entitled to any interest rates whatsoever. This is just one of the many factors you need to consider in your quest for a great reverse mortgage with excellent rates.

Check out a reverse mortgage calculator online. Places like the AARP website have a calculator that is free and to use you simply answer four questions about your age, the age of your spouse, the value of your home and provide your zip code. In short order, the calculator will crunch some numbers giving you an estimate of what reverse mortgage rates you should get.

While an estimate is great, in order to really know the nitty-gritty details, you need to talk to a lender who will give you specific rates relevant to your unique situation. To find a lender you can trust, ask your family and friends for recommendations and then contact the multiple companies until you find one that has the reverse mortgage rates you want and that you feel comfortable working with to secure your reverse mortgage loan.

Our educational learning series about senior finances will give you information about reverse mortgages and many other relevant topics. You can feel secure that the reverse mortgage lenders in our directory are registered and in good standing. The goal is to educate about reverse mortgages and assist in the next step of speaking to a reverse mortgage lender. If either taxes or insurance lapse, it could result in a default on the reverse mortgage.

To find relevant details on something specific such as reverse mortgages ask your friends and co-workers for info they may have found out on it. You can also look up various groups on the web that discuss things such as newsgroups and forums. There is one on so many topics and you can post your own question. See below for more information on Reverse Mortgage Rates.