As the popularity of Home Equity Conversion Mortgages (HECM) or reverse mortgages grow so does the potential for scams against mature Americans over the age of 62. The reverse mortgage program was designed to give mature Americans the ability to sustain their current way of life by using the equity in their current homes for additional or supplemental income. Reverse mortgages are backed by the U.S. Department of Housing and Urban Development (HUD) but scams are reported by the Federal Bureau of Investigation (FBI) and the Government Accountability Office (GAO). Continue reading ‘GAO Warns on Reverse Mortgages’ »
Posts tagged ‘Reverse Mortgage’
An annuity reverse mortgage is quite different from other regular and not so traditional mortgages. However, it is more beneficial for the policy holder. Well, annuity reverse mortgage is where a senior citizen can borrow against the equity in their home to receive payment in a form of monthly payment or lump sum. Hence, it is advisable to opt for this kind of reverse mortgage because it offers great benefits.
With the time, the loan balance decreases, as the insured is able to pay the amount of equity in allocated tenure. In this kind of loan, the borrowers receive money for the equity in their homes. As they receive money, the equity in their home declines and their loan balance increases. However, an annuity reverse mortgage should not be confused with a home equity loan or home equity line of credit, as both of these are ways of obtaining money for the equity in a home. With either of these, the borrower must pay at least the monthly interest that is levied on the loan amount received, or the amount that they have drawn from their equity line. However, a reverse mortgage client does not have to pay anything until the loan is paid off. However, it is quite different for annuity reverse mortgage. Continue reading ‘Earn More With Annuity Reverse Mortgage’ »
Do you need to finance a home improvement? Pay off a current mortgage? Supplement your retirement income? Look after medical care expenses? If this is so a reverse mortgage corporation will do wonderful things for you. With a reverse mortgage, you can turn the value of your home into money without having to reimburse your loan every month. When Is It Repaid? A reverse mortgage is a loan taken out against your house. The smartest thing about it is that you do not have to repay it for so long as you live there. One. Single-purpose reverse mortgage This is offered by non-profit associations, state states, and local agencies. Two.
Federally-insured reverse mortgage This is also know as HECM, or Home Equity Conversion Mortgage.
In the last two years, the popularity of reverse mortgages has grown enormously.I was looking at some Australian statistics yesterday and in Australia, almost $900 million worth of loans written in 2008.
The trend in Australia follows huge success that lenders have had with the concept in both the UK and USA..The trend is set to continue as more retirees become cash poor.
The way a reverse mortgage works is quite simple
The loan once established requires no payments to be made by the retiree until one of the following events happens.
1. The borrower sells the property
2. The borrower(s) decide to move into an aged care facility
3. The borrowers pass away.
Why is there a need for Reverse Mortgages?
The reverse mortgage concept came about because of the amount of cash poor retirees having to sell the homes to live. Most of these people owned or had very significant equity in their principal residence but were quite cash poor.
The best part about a reverse mortgage is that the borrowers have no restrictions on what they use the money for. Whether they want to use the money to travel or give their grandchildren money for university they have choice.
The truth is that if someone needs a reverse mortgage it is mainly because of insufficient funds to live without regular income. Some would say they have not allocated their money well enough.
In truth their can be so many reasons that a retiree needs to consider a reverse mortgage including health reasons that called for an early retirement.
Continue reading ‘Reverse Mortgages and exactly how they work’ »
Are you considering a reverse mortgage? The internet has much of the information you need to help you through the reverse mortgage process. Here we will highlight five comprehensive websites for you to gather the facts and put your reverse mortgage plan into action.
AARP
The America Association for Retired Persons provides a wealth of information and resources for people over the age of 50. AARP’s website contains an entire section devoted to reverse mortgages. The site also provides a downloadable booklet covering the basics of reverse mortgages and the different mortgage types available. The booklet is written simple language with supporting graphics and charts. AARP also provides links to reverse mortgage counselors, originators, lawyers, financing planners and other reverse mortgage professionals
Fannie Mae
Fannie Mae, although originally established as a government agency, is a shareholder-owned company which provides affordable housing to Americans in accordance with a congressional charter focusing on providing financial services to low and middle income home buyers. Fannie Mae itself does not lend money but insures reverse mortgages and works closely with lenders to provide reverse mortgage loans. Fannie Mae provides two types of reverse mortgages: the Home Keeper Loan and the Home Keeper for Purchase Loan.
Continue reading ‘The Top 5 Resources for the Scoop on Reverse Mortgages’ »
You may have heard your friends and family talking about reverse mortgages. There’s also been a lot of television commercials offering information about reverse mortgages and reverse mortgage companies. Yet with all of this talk going on about FHA insured reverse mortgages and what they mean to you, what exactly is a reverse mortgage?
A reverse mortgage is designed specifically for homeowners who are age 62 and older. Through this product, you can receive a loan against your home in the form of a lump sum, regular monthly checks or a line of credit. The loan is typically repaid with interest when you sell your house, permanently move or pass away.
Reverse mortgages are getting to be more and more common these days. Reverse mortgage loan advances are not taxable, and generally don’t affect your Social Security or Medicare benefits. You retain the title to your home, and you don’t have to make monthly repayments. The loan must be repaid when the last surviving borrower dies, sells the home, or no longer lives in the home as a principal residence. Not like the regular mortgage the homeowner’s makes no payments and all interest is added to the lien on the property.
You may be wondering how you can benefit from getting a reverse mortgage? Many people have found that the money they got from a reversed mortgage benefited them greatly. With a reverse mortgage you continue to get income, and defer repayment, for as long as you live at home – no matter how long that may be. An FHA insured reverse mortgage maybe exactly what you need!
Let’s take a moment to understand reverse mortgage. Then we can better explore the benefits. A reverse mortgages is a very useful home loan option especially for senior homeowners. If you qualified, you don’t make any monthly payments. Equity in your home repays the FHA insured reverse mortgage when you sell your home, passed away or move out permanently. You or your children keep the extra money on top of what you owe the lender.
What are the benefits? There are many benefits that a reverse mortgages can give you. However here are a few of the most significant. First, you will remain independent. This will allow you to remain in your home and retain home ownership.
The second benefit is no monthly mortgage payments are required. You need not pay back the reverse mortgages loan nor make any monthly mortgage payments until you permanently move out of the home. It is also tax-free money, because the money you receive from a reverse mortgage is not considered income, it is tax free and will not affect your Social Security or Medicare benefits.
Another great benefit is freedom and flexibility. The money you get from a reverse mortgage is yours to use in any way you choose. You can take comfort knowing you are financially secure and not a burden on your family. You can buy gifts for grandchildren and other members of your family. You can remodel your home, go on wonderful vacations, pay off any other monthly bills and even buy a new car!
Continue reading ‘How You Benefit From A Reverse Mortgage’ »