We have all seen the commercials with Fred Thompson or Henry Winkler (a.k.a. “The Fonz”) touting reverse mortgages as a financial product that can help you remain in your home and improve your cash flow in retirement. However, you may not be too familiar with how reverse mortgages actually work, who they can benefit, and the different kinds of options that are available for this kind of loan. History of the HECM and Who It Helps This government-insured program has been in existence for more than two decades, since a Home Equity Conversion Mortgage (HECM) pilot program was signed into [...]
What is a HECM: Home Equity Conversion Mortgage
May 3rd, 2013Tags: h.e.c.m., hecm, home equity conversion mortgage
Posted in About Reverse Mortgages | No Comments »
How the Reverse Mortgage Age Requirement Impacts Loan Size
April 24th, 2013Older homeowners who are “house rich, cash poor” might want to look into reverse mortgages to tap into the equity they’ve built up into their homes and improve their monthly cash flow. If you meet the reverse mortgage age requirement of 62 years old or above, you could be a candidate for the federally-insured Home Equity Conversion Mortgage (HECM) program. The loan can enable you to remain in your home longer and does not need to be repaid for as long as you maintain principal residency in your home and keep up with property taxes and insurance. Because the length of [...]
Tags: age, reverse mortgage age
Posted in About Reverse Mortgages | 1 Comment »
Use a Reverse Mortgage to Finance Your Next RV Purchase
April 19th, 2013Reverse mortgages are a great way to improve your cash flow during retirement by borrowing against the equity in your home or even to purchase a brand new primary residence. What you may not know is that if you’re in the market for a Recreational Vehicle (RV), you can use a reverse mortgage in place of financing for that too. And you’ll ultimately find some benefits that don’t come with traditional bank RV financing. As with any reverse mortgage that is insured by the Federal Housing Administration (FHA), you’ll need to be 62 or older to qualify and must adhere [...]
Tags: recreational vehicle, reverse mortgage rv, rv
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Reverse Mortgage for Purchase: Adjustable Vs. Fixed Rate Options
April 15th, 2013If you’re one of the 78 million baby boomers approaching retirement, you may be thinking about downsizing or moving into a home more geared toward aging in place. Some older adults have difficulty obtaining a mortgage to buy a new home, especially if they no longer have steady income from a job. Rather than use a conventional mortgage to purchase your home, you could opt for a reverse mortgage, which allows borrowers aged 62 and older to access their home’s equity in the form of a loan. The Home Equity Conversion Mortgage (HECM) for Purchase program can [...]
Tags: hecm purchase
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Can you get a Reverse Mortgage with a Life-Estate?
April 5th, 2013Question from an ALLRMC Reader: “I am considering a RM and have my debt free property in a Life Estate, my Sis is the Grantee. I understand she would have to sign the loan/closing docs without having to have had the Counseling but where I am fuzzy is, title would still be held in the Life Estate, correct? Are there any negatives here? Also, if I Quit Claim her off before RM is executed can I Quit Claim her back same Life Estate and if so would that entitle her to the same rights as an heir for the [...]
Tags: life estate, reverse mortgage life estate
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Reverse Mortgage Adjustable Rate Offers BIG Benefits
March 28th, 2013The number of people opting to take out a fixed rate reverse mortgage has gone up dramatically over the last few years, but it’s important not to overlook all the benefits of having an adjustable rate. While the certainty of the fixed rate can be a positive, taking out an adjustable rate reverse mortgage comes with features you won’t find on any fixed rate product. Adjustable Rate Provides Multiple Product Options and Flexibility Under the Federal Housing Administration’s Home Equity Conversion (HECM) program, borrowers have the choice between taking a reverse mortgage with an adjustable rate or a fixed [...]
Tags: interest, reverse mortgage adjustable rate, variable rate
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Which is Best? Fixed vs. Adjustable Rate Reverse Mortgages
March 15th, 2013If you’ve made the decision to stay in your home, but you’re not sure if your savings will allow you to do so, a reverse mortgage could be a potential solution to help you achieve financial stability. But different reverse mortgage types can serve different purposes and as with any mortgage, you must consider which rate option is best suited for you before taking out the loan. Just like any other mortgage, reverse mortgages offer two types of interest rates: fixed rates and adjustable rates. Insured by the Federal Housing Administration (FHA), the most common reverse mortgages in the market [...]
Tags: amortization, best, fixed vs adjustable
Posted in About Reverse Mortgages | 1 Comment »
Can You Get a Reverse Mortgage on Farmland?
March 12th, 2013Good Evening, I am researching Reverse Mortgages for my parents (ages 63 & 66). My only concern is that they own a farm that is preserved in the state of New Jersey. They currently have it for sale, but really do not wish to sell, but think they have no other choice (dad is retired and ill, mom is working again but not making enough) They did own a very successful business, however, due to the economy and my father’s health, the cost of running the business far exceeds the income it’s bringing in (hence her having to get outside employment). And [...]
Tags: farm, farmland
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Last Call for Fixed-Rate HECM Standard Reverse Mortgages
March 7th, 2013The time frame is running out for the Standard Fixed Rate version of the reverse mortgage program known as the Home Equity Conversion Mortgage (HECM or “Heck-um”). HUD announced that the last day that they will issue Case Numbers for this program is prior to April 1st, however borrowers must be aware that the 2 days leading up to April 1st are Saturday & Easter Sunday, thus making the last available day to return your application and signed counseling certificate Friday March 29th. All loans with assigned case numbers must then close by July 1, 2013 or the borrower will [...]
Tags: 2013, fixed rate standard, fixed-rate hecm
Posted in FHA / HUD News | No Comments »
4 Reasons A Reverse Mortgage May Be a Bad Idea
March 1st, 20134 Reasons A Reverse Mortgage May Not Be Right For You… A reverse mortgage can be a very viable solution for the right homeowner—one who is primarily seeking a way to effectively age in place. Available to people who are age 62 or older and have built up a substantial amount of equity in their homes, reverse mortgages allow borrowers to wipe out their mortgage payments and can also serve as a means to generate additional cash flow in retirement. But reverse mortgages are not right for everyone. Here are some tell-tale signs that another financial solution [...]
Tags: bad idea, reverse mortgage bad idea
Posted in Pros & Cons | No Comments »