Archive for February, 2008 Page 2 of 3

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More Americans Are Giving Up Golf

Posted on February 22, 2008 by Jason

The New York Times, February 21th, 2008

HAUPPAUGE, N.Y. — The men gathered in a new golf clubhouse here a
couple of weeks ago circled the problem from every angle, like caddies
lining up a shot out of the rough.

“We have to change our mentality,” said Richard Rocchio, a public relations consultant.

“The
problem is time,” offered Walter Hurney, a real estate developer.
“There just isn’t enough time. Men won’t spend a whole day away from
their family anymore.”

William A. Gatz, owner of the Long Island
National Golf Club in Riverhead, said the problem was fundamental
economics: too much supply, not enough demand.

The problem was not a game of golf. It was the game of golf itself.

Over the past decade, the leisure activity most closely associated with
corporate success in America has been in a kind of recession.

The
total number of people who play has declined or remained flat each year
since 2000, dropping to about 26 million from 30 million, according to
the National Golf Foundation and the Sporting Goods Manufacturers
Association.

More troubling to golf boosters, the number of
people who play 25 times a year or more fell to 4.6 million in 2005
from 6.9 million in 2000, a loss of about a third.

The industry
now counts its core players as those who golf eight or more times a
year. That number, too, has fallen, but more slowly: to 15 million in
2006 from 17.7 million in 2000, according to the National Golf
Foundation.

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If Passed, the FHA Modernization Act of 2007 Harkens Good Things for Reverse Mortgage Borrowers

Posted on February 20, 2008 by connellan


How Much Money You Can Get for a Reverse Mortgage Will Increase and Qualifying for a Reverse Mortgage Will Get Easier with the FHA Modernization Bill

The FHA Modernization Act is designed to improve the Federal Housing Authority’s ability to help Americans obtain safe and affordable home loans and many see the Act as an answer to some of the woes of the subprime debacle. The Act is a bipartisan measure and has the support of the Bush Administration as well as both consumer and industry groups.

S. 2338, the Federal Housing Authority (FHA) Modernization Act, is good news for borrowers interested in a Reverse Mortgage. The Bill has been passed by the Senate by an overwhelming majority (93 to 1) and many hoped that it would be tacked onto the Economic Stimulus Package and be signed into law this week. However, it was not and is now waiting to be voted on by the House of Representatives. The House version of this Bill differs in many ways, but on HECM Reverse Mortgage issues, the House and Senate versions are identical.

The FHA Modernization Act Will Improve the Terms of Reverse Mortgages

The FHA Modernization Act will change the HECM program (HECM is the most popular type of Reverse Mortgage) in the following ways:

  • Offer a Single National Loan Limit: Currently the actual amount you can qualify for with a HECM Reverse Mortgage varies depending on your county. The FHA Modernization Bill sets a single national limit of $417,000.. For most borrowers this means more money is available to them.

  • Eliminate of the Authorization Cap: Currently only a set number of Reverse Mortgage loans may be granted. The FHA Modernization Act eliminates this limit, enabling the FHA to authorize as many loans as the market demands.

  • HECM Could Be Used for Home Purchase: Currently Reverse Mortgage borrowers must reside in their home for at least one year before they can get a Reverse Mortgage on it. The FHA Modernization Act enables borrowers to actually purchase a home with a Reverse Mortgage — assuming an adequate down payment. This change makes a Reverse Mortgage an appealing loan for retirees who are downsizing and others.

  • HECMs Could Be Used on Coops: Currently only single family homes are eligible.

As a whole, these changes should mean more money and better terms for seniors doing a Reverse Mortgage.

Learn More About FHA Modernization and Contact Congress Now

If you wish to see the FHA Modernization Act become law, consider contacting your Congressperson. You can locate them here: http://www.house.gov/

To learn more about The FHA Modernnization Act, visit here:

http://www.opencongress.org/bill/110-s2338/show

Consider a reverse mortgage

Posted on February 20, 2008 by Jason

CNNMoney, February 10th, 2008

Retirees short on savings can benefit from these complicated loan products where the bank pays you.

Mortgage payments sucking you dry? Boomers short on retirement
savings may have another option: reverse mortgages. Can these
complicated products fill the gap?

Know the process

Reverse
mortgages are exactly that. Instead of paying the bank, the bank pays
you. It’s a type of loan where your equity is converted into cash.

These
mortgages are designed for people 62 and older. And you can get this
cash in a few ways: Either you can get it all in a lump sum, a monthly
payment or a line of credit that you can tap into when you need it.

The
loan doesn’t need to be repaid if you continue to live in the home. But
if you move, the debt must be repaid – with interest. If you die, your
heirs can elect to sell the house to repay the loan.

While the
payment doesn’t usually affect social security or Medicare, it may
affect Medicaid according to Peter Bell of the National Reverse
Mortgage Association.

You will also be responsible for property taxes and any repairs on the home.

The
amount you can borrow depends on your age, the current interest rate,
and the appraised value of your home. Generally, the more valuable your
home is, the older you are, the lower the interest, the more you can
borrow.

Consider your Candidacy

The older you are, the more likely you are to benefit from a reverse mortgage according to AARP.

First,
you’ll probably have built up more equity in your home. And lenders
calculate the payout based on your age and your expected lifespan.
Reverse mortgages are most beneficial if you own your home or have a
small amount left to pay on the original mortgage that can be paid off
at closing with the proceeds from the reverse loan, according to HUD.

Reverse
mortgages are also best for people who want to remain in their home for
the long-term. If you’re looking to move in two or three years, a
reverse mortgage may not be right for you.

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Congress looks into reverse mortgages as abuses begin to appear

Posted on February 19, 2008 by Jason

The Palm Beach Post, February 18th, 2008

Now that the subprime mortgage business has
crashed, many lenders are reviving their incomes by persuading older
homeowners to take out reverse mortgages.

Many retirees report being pleased with their reverse mortgages, but
consumer advocates say Congress should move faster to protect the
elderly from unscrupulous lenders pushing mortgages that sometimes cost
far more than borrowers realize.

Reverse mortgages allow older homeowners to obtain cash by siphoning some of the equity in their property.

The older the homeowner and the greater the home value, the more
cash that can be made available as a lump sum, monthly payout or line
of credit.

When reverse mortgage borrowers die, their heirs must repay the
loan, plus interest and fees, typically by selling the property. They
keep whatever equity is left.

With the oldest of the nation’s 76 million Baby Boomers turning 62
in 2008, such loans seem certain to proliferate in coming years.

“When used properly, reverse mortgages can be an effective way for
seniors to tap into the equity of their house,” U.S. Sen. Herb Kohl,
D-Wis., said at a December hearing of the Senate Special Committee on
Aging. “But too often these products are not used effectively, and
seniors end up losing their homes.”

Recently, a bill was introduced to prevent abuses of reverse mortgages.

“I think we should take a closer look at them,” said U.S. Sen. Chris Dodd, D-Conn., who chairs the Senate Banking Committee.

State officials also are becoming concerned. Last month, Florida
Attorney General Bill McCollum warned people considering reverse
mortgages that “deceptive practices and allegations of high-pressure
sales tactics are being more frequently encountered.”

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Gentlemen, 5 Easy Steps to Living Long and Well

Posted on February 19, 2008 by Jason

The New York Times, February 19th, 2008

Living past 90, and living well, may be more than a matter of good
genes and good luck. Five behaviors in elderly men are associated not
only with living into extreme old age, a new study has found, but also
with good health and independent functioning.

The behaviors are abstaining from smoking, weight management, blood pressure control, regular exercise and avoiding diabetes. The study reports that all are significantly correlated with healthy survival after 90.

While
it is hardly astonishing that choices like not smoking are associated
with longer life, it is significant that these behaviors in the early
elderly years — all of them modifiable — so strongly predict survival
into extreme old age.

“The take-home message,” said Dr. Laurel B. Yates, a geriatric specialist at Brigham and Women’s Hospital
in Boston who was the lead author of the study, “is that an individual
does have some control over his destiny in terms of what he can do to
improve the probability that not only might he live a long time, but
also have good health and good function in those older years.”

The
study followed more than 2,300 healthy men for as long as a
quarter-century. When it began, in 1981, the subjects’ average age was
72. The men responded to yearly questionnaires about changes in health
and lifestyle, and researchers tested their mental and physical
functioning. At the end of the study, which was published Feb. 11 in
The Archives of Internal Medicine, 970 men had survived into their 90s.

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Is a reverse mortgage right for you?

Posted on February 19, 2008 by Jason

MSNBC, February 19th, 2008

Five things to consider before you (or your parents) join the frenzy

Doesn’t it seem like every time you turn on
your television or open your newspaper, you see an advertisement for a
new financial product? The industry is constantly hard at work coming
up with new ways to help you manage your money, boost your income and
invest more.

A
good chunk of these new products fall flat. But every once in a while,
one will take hold in a way that even the experts didn’t see coming. To
me, that means it’s time to look under the hood, kick the tires and
really get a sense of whether that particular product is for you before
you buy into all the hype. These days, that hype is about reverse
mortgages.

Designed for people 62 and over, these
mortgages — which in fact aren’t all that new, but have just recently
taken off — enable you to have a bank buy back your home while you’re
still living in it. It provides an income that you can opt to receive
in a lump sum, a monthly payment or a line of credit that you draw upon
when necessary.
Sounds kind of like winning the lottery, right?
Not quite. You have to pay the money back (plus interest) when you
vacate or sell the home, and there are fees involved. Still, these
mortgages do have a place, and they’re rapidly finding it: According to
a recent report by the AARP, while only about 1 percent of older
homeowners have a reverse mortgage, there were 107,000 loans made in
2007 compared to only 6,600 in 2000.

Here’s what you need to consider before you (or your parents) join the reverse-mortgage frenzy:

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Reverse lending on rise in D.C.

Posted on February 19, 2008 by Jason

The Washington Times, February 19th, 2008

More Washington-area residents
are turning to reverse mortgages for retirement income as traditional
sources of credit grow scarce.

In the D.C. area alone, the number of home-equity conversion
mortgages (HECMs), by far the most popular type of reverse mortgage
loan, has risen 289 percent since 2005, according to the National
Reverse Mortgage Lenders Association.

Diana and Peter Nicholson, a couple in their 60s who live in a
condominium in the Van Ness area, took out a reverse mortgage about a
year ago at the urging of their friends.

“We took it out as a security blanket,” said Mrs. Nicholson, a
retired paralegal. “So far we have used it for some basic household
expenses.”

Nationwide, reverse mortgage lending has seen similar growth,
with 107,558 loans originated in fiscal 2007, up 249 percent since
2005, according to the Federal Housing Administration. HECMs make up
most of the reverse mortgage market — about 90 percent — because the
loans are insured by the FHA, making them a much safer investment for
lenders.

With more than 34 million Americans over the age of 65 and
millions more baby boomers reaching retirement age, lenders are quickly
becoming aware of the lucrative potential of the reverse mortgage
market. Recent entrants include major lenders such as Bank of America
and Quicken.

“I think everybody sees the silver tsunami on its way in baby
boomers,” said Shelley Giordano, a reverse-mortgage broker for Wells
Fargo, one of the largest HECM lenders in the D.C. area. “They are not
as averse to borrowing as other generations have been. Lenders know
that is the place to be.”

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Reaching 100 is easier than suspected

Posted on February 12, 2008 by Jason

Yahoo News, February 12th, 2008

CHICAGO – Living to 100 is easier than you might think. Surprising
new research suggests that even people who develop heart disease or
diabetes late in life have a decent shot at reaching the century mark.

“It
has been generally assumed that living to 100 years of age was limited
to those who had not developed chronic illness,” said Dr. William Hall
of the University of Rochester.

Hall has a theory for how these people could live to that age. In an editorial in Monday’s Archives of Internal Medicine,
where the study was published, he writes that it might be thanks to
doctors who aggressively treat these older folks’ health problems,
rather than taking an “ageist” approach that assumes they wouldn’t
benefit.

For the study, Boston University
researchers did phone interviews and health assessments of more than
500 women and 200 men who had reached 100. They found that roughly
two-thirds of them had avoided significant age-related ailments.

But the rest, dubbed “survivors,” had developed an age-related
disease before reaching 85, including high blood pressure, heart
disease or diabetes. Yet many functioned remarkably well — nearly as
well as their disease-free peers.

Overall, the men were functioning better than the women. Nearly
three-fourths of the male survivors could bathe and dress themselves,
while only about one-third of the women could.

The researchers think that may be because the men had to be in
exceptional condition to reach 100. “Women, on the other hand, may be
better physically and socially adept at living with chronic and often
disabling conditions,” wrote lead author Dr. Dellara Terry and her
colleagues.

Rosa McGee is one of the healthy women in the study who managed to
avoid chronic disease. Now 104, the retired cook and seamstress is also
strikingly lucid.

“My living habits are beautiful,” McGee said in an interview at her
daughter’s Chicago apartment. “I don’t take any medicines. I don’t
smoke and I don’t drink. Never did anything like that.”

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Retiring Abroad May Not Be Paradise

Posted on February 5, 2008 by Jason

The Wall Street Journal, February 5th, 2008

As the first wave of baby boomers hits retirement age,
life overseas beckons. But be warned: Retiring abroad can have its
logistical headaches.

Many of today’s graying expatriates are heading
permanently offshore to stretch their nest egg. Jon and Gretchen
Nickel, formerly of Portland, Ore., settled in Panama, where they say
they can live like the rich without needing a big bankroll. Lee
Harrison and Julie Lowrey, from Vermont, moved to Uruguay because the
lower living costs allowed them to retire years early. Other expat
retirees are seeking foreign adventure, cultural experiences and exotic
travel, without having to board an airplane.

But retiring to a foreign land can present a number of challenges, from
opening a local bank account to avoiding being gouged for services. And
while many countries, from Belize to South Africa, offer inducements to
attract foreign retirees, making sure you’ve got health insurance can
be a big problem.

Moving abroad also means leaving behind family and friends, though
Internet communications can shorten the distances. There can also be
safety and security concerns, depending on where you end up.

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Housing Meltdown

Posted on February 5, 2008 by Jason

BusinessWeek, February 5th, 2008

As Washington policymakers struggle to keep the U.S. out of recession,
the swirling confusion over the housing market is making their job a
lot tougher. Will American consumers keep shopping or be forced to pull
back? Will banks lend freely or be hamstrung by mortgage defaults? What
are the best policy options right now? Those and other important
questions simply can’t be answered without a good idea of whether home
prices will rise, flatten out, or keep dropping.

Some experts have begun to suggest that a bottom is in sight. Pali
Research analyst Stephen East wrote in a research note to his firm’s
clients on Jan. 25 that “the sun is not shining very brightly, but at
least the worst of the storm has likely passed.” With optimism budding,
Standard & Poor’s beaten-down index of homebuilder stocks soared
49% from Jan. 15 through Jan. 29.

But it’s considerably more likely that the storm is still gathering
force. On Jan. 30 the government said annual economic growth slowed to
just 0.6% in the fourth quarter as home construction plunged at a 24%
annual rate. The Standard & Poor’s/Case-Shiller 20-city home price
index fell 7.7% in November from the year before, the biggest decline
since the index was created in 2000.

And that could be just the start. Brace yourself: Home prices could
sink an additional 25% over the next two or three years, returning
values to their 2000 levels in inflation-adjusted terms. That’s even
with the Federal Reserve’s half-percentage-point rate cut on Jan. 30

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