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Reverse Mortgage to Buy a New House: How much home can I buy?

April 22nd, 2014

Many people take out a reverse mortgage as a way to enable them to remain in their homes while reducing their housing expenses in retirement, but an increasing number of people are using a relatively new type of reverse mortgage to purchase a brand new home that will help them live out that same goal.   Even if you already have a reverse mortgage, using the HECM for Purchase as a way to relocate is still an option.   The HECM for Purchase   This reverse mortgage type was rolled out by the Federal Housing Administration several years ago as […]

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Reverse Mortgage Appraisal Problems? Ask The Expert Series

April 21st, 2014

About 6 years ago we had our home appraised for refinancing and it came in at over 210K.  As seniors with no children we decided a reverse mortgage would be a wonderful solution to our money issues and I went on www.homes.com, entered our zip code and zoomed to our block which consists of 6 duplex houses.  According to the website, each of the individual halves of those duplexes are valued at 179 to 181K, so we pursued a RM.  The company sent an appraiser to our home (which we did not have to pay for), and she spent maybe […]

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6 Signs You’re Ready for a Reverse Mortgage

April 21st, 2014

  1. You’re 62! Happy birthday! The federally-insured Home Equity Conversion Mortgage program requires borrowers to be at least 62 years of age in order to qualify for the loan.   Other basic requirements include owning your home outright or with most of your mortgage paid off, maintaining that home as your primary residence, and staying current on property tax and homeowners insurance.   2. You don’t want to leave your home—ever If you’re comfortable in your current home and have no plans or desire to move, a reverse mortgage can help you stay. With a federally-insured HECM, you still […]

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What Happens When Your Reverse Mortgage Money Runs Out

March 28th, 2014

My parents have a reverse mortgage with LOC maxed out. It was very helpful to them for many years. One parent is in a long-term care facility and on Medi-Caid. My other parent is living in the home and my understand can live there for as long as alive and able to live there. When both parents are gone, I understand that the outstanding loan (including interest etc would be due and payable (first position) and that Medi Caid would come in and claim whatever they have paid on behalf of parent (second position). Therefore, what would be your recommendation […]

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Growing Demand Ahead for Reverse Mortgages

March 21st, 2014

If you’re a homeowner who’s considering retiring, you may already be in possession of your most important source of retirement funding: your home.   Demand for reverse mortgages—a type of loan that allows you to borrow against the equity in your home, if you’re 62 or older—is expected to increase as a retirement planning tool, finance and economics experts say.   “Having alternative sources of retirement income is critical for those who are currently retired, those retiring in the near future, and those planning to retire in the next 30 to 40 years,” write David W. Johnson, Ph.D. and Zamira […]

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Reverse Mortgage Purchase with Bad Credit / Recent Foreclosure?

March 18th, 2014

married borrowers  # 1 has good credit-no blemishes # 2 has a bankruptcy with 2 foreclosurees 2.5 years ago @1 self employed and @ employed full time. Combined income about $160,000 per year. #1 owns two properties which he intends to sell and use the proceeds from sales as a down payment for a new home for #1 and #2 to own jointly using a reverse for purchase. Questions: 1) Can both be on the loan and on title considering # 2′s credit issues? 2) Assuming a cash down payment of $150-160,000 what amount can received toward the purchase of […]

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Why Do Reverse Mortgages Have Mortgage Insurance?

March 17th, 2014

If I take a reverse mortgage do I have to pay PMI insurance even if I pay my own home owners insurance?   Hi Sue, PMI is the acronym that stands for “Private Mortgage Insurance”.  PMI is used on conventional loans and allows borrowers who wish to obtain a loan with less than 20% equity in a property to qualify for the loan.  This insurance insures the lender against any losses that they might incur if the borrower should default on the loan.  Its one real benefit to the borrower is that it allows borrower access to higher loan to […]

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Issues that can arise when a condo owner obtains a reverse mortgage?

March 13th, 2014

What are the issues that can arise when an individual condo unit owner obtains a reverse mortgage? – Ashley   Hi Ashley, If you are asking me if there are any additional issues that may arise after the loan is complete, then I would have to say that there are no special issues that condominium owners need to worry about after their loan is closed that the owner of a single family detached dwelling would not also need to concern themselves with.  Just like other reverse mortgage holders, they need to keep all insurance, taxes and in their case HOA […]

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NEW: Fixed-Rate Reverse Mortgage Credit Line by All Reverse Mortgage

February 23rd, 2014

New Reverse Mortgage Product Offers Certainty of Fixed Rate, Flexibility of Payment Plans   For the first time ever, a new reverse mortgage is available that offers borrowers all the certainty of a fixed-rate loan as well as the flexibility of multiple payment options all in one product.   In years past, borrowers who opted for a fixed rate reverse mortgage were required to draw their loan proceeds in a single, upfront payment.   Today, borrowers have much more flexibility in choosing how they wish to receive the money from their reverse mortgages as a result of recent rule changes […]

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Avoid Payment Shock—Turn your HELOC into a HECM

February 14th, 2014

Billions of dollars worth of home equity lines of credit (HELOCs) are about to amortize this year, and if you’re one of those borrowers who has one and you’re aged 62 or older, don’t panic—you might be able to use a reverse mortgage to pay off your loan.   According to a recent report from Moody’s Investor Services, around $30 billion of HELOCs are going to start amortizing in 2014. What this means is that the loan’s initial 10-year interest-only period is over, and borrowers must start making payments on both interest and the loan principal.   Sometimes this results […]

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