'Income & Credit Requirements' Category Archives

Reverse Mortgage LESA Set-Aside Offers Peace of Mind

December 29, 2020 34 comments

How a “LESA” is Giving New Peace of Mind to Reverse Mortgage Borrowers Reverse mortgages have changed for the better. These mortgages, which allow people 62 and older to tap into their home equity in the form of a non-recourse loan, have new requirements and options making them safer and more sound for borrowers. In 2015, the Federal Housing...
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Who’s Responsible for Property Taxes on a Reverse Mortgage

December 3, 2020 15 comments

Who pays property taxes and insurance on a reverse mortgage? The normal way is for the reverse mortgage homeowner to pay their own taxes and insurance EXCEPT if you do not meet the residual income or credit requirements of the program. And then, instead of an automatic declination if your income or credit does not meet the requirements like a...
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How Financial Assessment Made Reverse Mortgages Safer

November 29, 2019 no comments

"This financial assessment process is conducive to making the Home Equity Conversion Mortgage (HECM) an even safer loan product. If a potential borrower can swallow such an absurdity he need not be concerned about who this financial assessment (FA) is making the product safer for! The FHA wants .50% insurance and will only allow 60% loan to value and now...
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How Bankruptcy May Affect Your Reverse Mortgage Eligibility

November 27, 2019 42 comments

We have recently had several borrowers who had previously obtained a reverse mortgage call and ask us what the effect would be on those reverse mortgages if they had to now begin a bankruptcy proceeding. While we are not attorneys and would always advise you to seek competent legal advice from an attorney in your state, we did want...
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How Reverse Mortgage Financial Assessment Works

October 1, 2019 6 comments

Lenders must conduct a mandatory financial assessment of all borrowers as part of the loan application process. Historically, borrowers qualified for a reverse mortgage based on their: Age: a minimum of 62 Home equity: a level deemed substantial enough by the lender based on guidelines provided by the Department of Housing and Urban Development (“HUD”) Those factors...
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HOA Payment History Can Affect Reverse Mortgage Eligibility

August 22, 2017 6 comments

We live in an area with an HOA we had a dispute with them that was settled but that has come back to bite us big time. We have excellent credit have paid our insurance, taxes, and mortgage on time but apparently it is not enough to satisfy HUD according to our mortgage dealer. They wanted $70,000 up front for...
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Can I Opt for a Voluntary Life Expectancy Set-Aside? (LESA)

February 10, 2017 2 comments

Just learned of this feature, LESA. Am a current Reverse Mortgage holder and received a solicitation from a mortgage co. There is a lot to absorb regarding RM's and unless you are an educated real estate professional, it is virtually impossible to understand all the ramifications of these deals. Even with the "counseling" as required, total understanding remains murky. I...
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This Little-Known LESA Growth Feature Is a Game Changer

November 11, 2016 no comments

This Little-Known Reverse Mortgage Feature Could Be a Game Changer Qualifying for a reverse mortgage is tougher for some people today than it has been in the past. That’s because new underwriting standards have been developed in the past year to ensure that these loan products are safer for the borrowers who use them. As of April 27,...
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Financial Assessment Update Takes Effect October 3, 2016

September 26, 2016 no comments

Reverse Mortgage Financial Assessment Update Purpose The intent of this article is to announce upcoming updates to the HECM Financial Assessment and Property Charge Guide guidelines. Implementation These changes are effective for case numbers assigned on or after October 3, 2016. New Requirements SECTION NO. SUBJECT REVISED REQUIREMENT 2.14 Payment History on Housing Obligations Requirements apply only to the borrower's...
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HECM Financial Assessment & Extenuating Circumstances

April 2, 2015 no comments

Extenuating Circumstances Can Help You Qualify for a Reverse Mortgage Under the new reverse mortgage rules set to take effect April 27, lenders will be required to conduct a thorough analysis of your financial profile before you can qualify—an analysis known as the reverse mortgage “financial assessment.” This assessment weighs things like proof of income and credit history in its...
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