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Home / Blog / Income & Credit Requirements / How Reverse Mortgage Financial Assessment Works

'Income & Credit Requirements' Category Archives

How Reverse Mortgage Financial Assessment Works

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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...
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Reverse Mortgage Set-Aside (LESA) Offers Peace of Mind

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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 Administration, which...
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Can I Opt for a Voluntary Life Expectancy Set-Aside? (LESA)

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Just learned of this feature, LESA. Am a current Reverse Mortgage holder and received a solicitation from a mortgage co. There's 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 would...
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How Financial Assessment Made Reverse Mortgages Safer

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"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 1.25% insurance and will only allow 60% loan to value...
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Who pays property taxes and insurance on a reverse mortgage?

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Can I pay the property insurance and taxes yearly without the lender holding part of the funds in a reverse mortgage for a number of years? 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...
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This Little-Known LESA Growth Feature Is a Game Changer

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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

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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

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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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