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Have you considered a reverse mortgage but worried about inflation and rising interest rates? I recently had a borrower tell me that he was considering one but felt that he may have missed his opportunity before rates started to increase due to recent Fed rate hikes and inflation. He stated that he probably would not benefit now, with all the uncertainty of the future. Based on everything that was going on in the economy (inflation, interest rates, etc.), he just did not think a reverse mortgage made sense for him.... Read Full Article
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If you have decided to stay in your home but are still determining if your savings will last a reverse mortgage may be the solution to help you achieve that goal. Different reverse mortgage types serve different purposes, and as with any mortgage, you must consider which program and rate options are best suited for you. Like any other mortgage, reverse mortgages offer two interest rates: fixed and adjustable. Insured by the Federal Housing Administration (FHA), the most common reverse mortgages on the market today are Home Equity Conversion Mortgages (HECM... Read Full Article
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My mother has a reverse mortgage and recently had to go into a nursing home as she is terminally ill. According to the agreement, we had to notify the "said reverse mortgage company" that she was no longer living in the property. We were told by phone (we failed to document who, what, and where) that we had six months to sell the property and possible extensions of up to a year. Two weeks later, we received a notice that the foreclosure process had started and that the debt was... Read Full Article
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HUD has a new requirement that for borrowers to use reverse mortgage proceeds to pay off an existing lien on which the borrower received $500 or more, the loan must have been in effect for at least 12 months. This includes any liens on which the borrower took out additional draws of $500 or more in the past 12 months, such as Home Equity Lines of Credit (HELOC). This includes single or cumulative draws totaling $500 or more over 12 months. This is something that all homeowners considering reverse mortgages... Read Full Article
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My MIL and FIL recently entered a reverse mortgage. The house is in good shape and worth about $150,000. I expect they will take a large distribution upfront as well as withdraw monthly amounts until they hit the max dictated by the lender. The large distribution up front coupled with fees, closing costs, mortgage insurance, and interest build means that if they continue to live in the house for even 15 years, I expect the loan balance to exceed the value of the home. Glad for the non-recourse nature of... Read Full Article
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We were looking to buy a home and signed a contract for sale for $730,000. The house appraised for just over that amount. Afterward, we learned that the seller owes more than that ($760,000) on a reverse mortgage. Does HUD/FHA need to approve the sales price before we can close? The seller can complete the transaction because the sales price is within 95% of the amount owed. Does HUD/the lender get to keep the difference between what is owed and the sales price? Are you sure that it... Read Full Article
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If you're considering taking out a reverse mortgage, it's important to understand its unique features. Did you know that the federally-insured home equity conversion mortgage (HECM) program has a loan payment option that grows over time, increasing your borrowing capacity? The HECM program allows homeowners aged 62 and older to access the home equity they've built up in the form of a non-recourse loan. As a borrower, you can spend your loan proceeds however you see fit, but you are required to stay current on your homeowner's insurance and property... Read Full Article
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Hello ARLO, My stepmother is in her 80's, has dementia, and is the sole Trustee of a Family Trust set up by my father years ago. My brother and I are the beneficiaries. A few years back her neighbors advised and assisted her in placing the house (which had been assigned to the Trust and is in the name of the Trust) into a Reverse Mortgage without consulting or notifying either myself or my brother beforehand. As sole Trustee, she has never provided required accountings and generally does not understand... Read Full Article
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In this article, you’ll learn: How to eliminate your monthly forward mortgage payment with a reverse mortgage What expenses will you still be accountable for after eliminating your mortgage payment How can you still make payments whenever you choose How to get the best deal & highest principal lending limit The ability to tap into the value of your home by turning its equity into cash can be a powerful tool for someone trying to find a way to expand their financial options for a whole host of reasons. This... Read Full Article
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Unlock the value in your home with the federally-insured Home Equity Conversion Mortgage (HECM) program, designed specifically for homeowners aged 62 and older. This non-recourse loan offers a secure way to access your home's equity without the obligation of monthly payments. While reverse mortgages may not be the perfect fit for everyone, they hold powerful benefits for certain individuals. Here are 10 compelling reasons why a reverse mortgage could be a wise financial strategy for those who qualify. 1. Budget breathing room/peace of mind Older adults live on... Read Full Article
