If you are considering a reverse mortgage, or researching one for a parent, friend, or client, we suggest you educate yourself on some of the most important features of the line of credit. A reverse mortgage line of credit used in the right way can be a valuable financial planning tool.
As of April 27, 2015, the rules for obtaining a reverse mortgages require the applicant to pass a three-part qualification, including a credit history analysis, a residual income test, a review of extenuating circumstances or compensating factors.
The reverse mortgage loan process has changed as of April 27, 2015 to become more like conventional loans. No longer will you be able to call multiple lenders and get an accurate quote based off of an estimated home value, mortgage balance, and youngest homeowner birth date. To get an accurate quote, you’ll need to be prequalified by an experienced reverse mortgage specialist. Talking to a loan officer that closes a handful of reverse mortgages per year is dangerous due to their part-time attention to a complex, dynamic business.
Are you under the impression that you will easily be able to make all financial decisions for your spouse should he/she become incapacitated? Marriage alone is often not enough. In our small section of the mortgage industry, we often find that people are unaware of the requirement to have written legal authority. Since we are speaking with clients over the age of sixty two years old, it is common to hear of one spouse having early signs of Alzheimer’s or having a stroke that leaves them incapacitated. It is never too early to be prepared for this difficult situation. Continue reading
The Department of Housing and Urban Development (HUD) decided to make changes to their non-borrowing spouse rules, effective for loans written on or after August 4th, 2014. There are several active lawsuits against HUD as a result of their old non-borrowing spouse rules, all due to the surviving spouse being told they must repay the loan or face foreclosure. There was always too much risk to the non-borrowing spouse under the old rules, so these changes are welcomed by everyone that follows the industry. Continue reading
In the simplest terms, a jumbo reverse mortgage is a loan initiated by a lender that makes it possible for owners of high value homes to tap into larger portions of their home equity than they wouldn’t be able to with a standard reverse mortgage. However, there are some important distinctions to draw Continue reading
Once you decide to move forward with a reverse mortgage, you will be faced with the decision of choosing a fixed rate or an adjustable rate loan. There are some significant differences between the two choices, so it’s a good idea to read further. Most people’s instinct is to lean towards the fixed rate product, but we think it should be the other way around.
A reverse mortgage is a great idea for seniors who might be facing a financial shortfall in retirement. Continue reading
Let’s face it: Not everyone has enough savings to live comfortably after retirement. According to an NBC News article, only 18% of the current workforce is “very confident” that they’ll have enough to make it through their golden years. Nearly a quarter are “not at all confident.” Continue reading
In this space, we’ll attempt to explain some of the intricacies of the reverse mortgage and keep you up to date with what his happening in this small part of the mortgage world. We’ll also discuss some general topics that are focused on aging, health, travel, etc. that you might find useful in your day to day life.
Our goal is to educate our readers about reverse mortgages so that they can make well-informed decisions when considering a reverse mortgage. We love feedback, so we encourage you to share your thoughts on our posts or other matters. If you have a reverse mortgage topic that you would like to see discussed, please contact us.