Tag Archive for 'reverse mortgage'

New Rules to Make Reverse Mortgage Qualification More Difficult

The U.S. Department of Housing and Urban Development will be instituting major changes to the Reverse Mortgage program.

Changes taking effect this month, effective September 30, 2013 include:

  • Limits to the amount of money that you can access in the first year of the loan
  • A new mortgage insurance fee structure which may mean higher fees for some borrowers
  • Lower loan amounts – experts estimate that total loan amounts will be about 15 percent lower after Sept. 30, 2013
  • Instructions for setting aside money to be used to pay property taxes and insurance

An additional change will take effect, but not until January 13, 2013

  • Borrowers who are assigned a case number after January 13, 2013 will be required to undergo a financial assessment. The assessment will include a credit history analysis, a cash flow/residual income analysis, analyzing compensating factors and extenuating circumstances and determining if the HECM applicant has the financial means to continue paying property taxes, insurance and other obligations.

These changes are significant and will take effect very quickly. If you are interested in a Reverse Mortgage, talking with a Reverse Mortgage lender immediately may work to your advantage.

Get Matched to Prescreened Licensed Reverse Mortgage Lenders Now.

Estimate Your Current Reverse Mortgage Loan Amount.

Reverse Mortgages Can Benefit Retirees, Both Wealthy and Not

A recent published article on The Wall Street Journal has explained the nature of reverse mortgage and how it can benefit seniors who are in need of money and those are well off. Some of the benefits are covering expenses for home modifications, repairs, medical expenses or home care, having a reliable credit line and lowering tax bills. To read the full article, please click “Reverse Mortgages Can Benefit Retirees, Both Wealthy and Not”.

 

 

 


Rising Interest Rates and Your Retirement…

Interest rates have started to increase off record low levels.

  • Some see this as good news – higher interest rates can mean a better return for retirees with fixed income investments.
  • Others see this as bad news – higher interest rates can mean higher mortgage rates – making housing and other debt more expensive.

The reality is that if you are already or near retirement, then slowly rising interest rates are not going to make a huge difference in your quality of life.  The amount you saved, how long you work in some capacity, when you start Social Security, how you manage expenses and if and how you tap your home equity  are much bigger factors than interest rates.

Discuss Interest Rates and Loan Amounts with a Reverse Mortgage Lender

Assess Your Retirement Preparedness with the NewRetirement Automated Online Planner

 

Housing News…IS Your Home Worth More Now?

While no two neighborhoods — even houses — are the same, the news from the real estate industry has been nothing but positive lately.

A few recent headlines:

  • In the first quarter of last year, nearly 1 million homes emerged from being underwater.  Nine point seven homes still owe more than they are valued, but that is down from 10.5 million underwater homes in the last quarter of 2012.
  • The total value of home equity owned by seniors rose by $49.5 billion in the first quarter of 2013.  The increase is due to both an increase in home values and a decline in mortgage debt.
  • Asking prices on homes for sale have jumped nearly 10 percent

If you are interested in tapping your home equity for retirement, then the increase in home prices is good news for you.

Estimate Your Reverse Mortgage Loan Amount

Download a FREE Guide to Reverse Mortgages.

 

 

Qualifying for a Reverse Mortgage in the Future

The FHA, which remains committed to preserving the HECM Reverse Mortgage program for seniors, hopes to continue its ongoing effort to strengthen the program. Provided that Congress grants the FHA authority to so, the FHA is considering the following changes:

A Financial Assessment for Borrowers – The details of the assessment have not been specified, but the intention is to verify that the borrower will have the financial means to remain in their home during the life of loan.
Principal Limit Utilization Restrictions: These restrictions have not been specified either, but they could include limiting the size of the initial cash draw or the total loan amount or possibly limiting both.
Tax and Insurance Set-Asides: The borrower would need to qualify for a larger loan so that funds would be available to put into an escrow account. The escrow account would be used to pay for taxes and insurance over the duration of the loan. Today the loan amount only need be large enough to pay off an existing mortgage; in the future, it may have to be large enough to also fund an escrow account.

These proposed changes are designed to keep the Reverse Mortgage program running for many years to come. If enacted, they will ultimately mean there is less money available for the smaller number of borrowers who will qualify. So, the good news is that qualified borrowers will still be able to get Reverse Mortgages long into the future. The bad news is that for those who qualify, they will likely receive a lower payout than they would under today’s rules.

Fortunately, you can take action today to secure a Reverse Mortgage with the current standard qualifications.

Get Matched to Prescreened Licensed Reverse Mortgage Lenders Now.

Estimate Your Current Reverse Mortgage Loan Amount with the Reverse Mortgage Calculator.

Too Much Stuff?

The 2010 Health and Retirement Study (HRS) included questions asked of persons aged 60 plus about personal belongings.

Some of the findings:
• Five percent of respondents said that they had fewer things than they needed.  Thirty five percent said they had just the right amount.  Sixty percent said they had more than necessary. Do you have extra stuff?

• People who had moved in last the two years reported less excess stuff.  Could downsizing help pare down excess belongings?

• When asked about whether or not belongings were an impediment to moving, 48 percent said that the belongings made them reluctant to move even though they admitted to having too many things.

The University of Kansas Gerentology Center has additional research as well as advice about downsizing possessions in later life.

Considering Downsizing?  Have You Thought About Using a Reverse Mortgage to Purchase a Home?
Talk to a Lender About a Reverse Mortgage for Purchase!

Don’t Dismiss Reverse Mortgages!

The Consumer Financial Protection Bureau (CFPB) recently released a purely negative report that degraded the use of reverse mortgages. However, there are actually many benefits of a reverse mortgage.

First off, in order to qualify for a reverse mortgage, you must own and reside in your home and be a senior 62 years of age or older. (In most cases second homes, apartment buildings and homes less than a year old are not eligible for a reverse mortgage.)

Reverse mortgages must be considered with all other options like selling the home, downsizing, or moving to an assisted living facility. These types of loans are long term decisions because  there are insurance fees and mortgage interest that gets added to the loan balance every month. So someone that plans on selling in 5 years will have less equity.

For anyone who chooses to participate in a reverse mortgage program, they can take their money in regular payments for a fixed term, a line of credit, or select some combination of these choices by receiving the entire amount in a lump sum.

These special types of loans might be good options for homeowners that still have a mortgage, credit card debt, or need to make necessary repairs to their home. And with any financial decision, it is important to talk with trusted financial advisors to help make your decision.

The bottom line is this: reverse mortgages may not work for everyone but dismissing the service completely might prove to doom many households to poverty in old age.

Visit newretirement.com for a number of free services:

 

 



Retirement Realities in a Stumbling Economy

With a downward spiraling economy, there are a few realities that you need to keep in mind and take into consideration in order to land a safe and successful retirement.

  • The first strategy is working in retirement. According to experts, 70 is the new 65, in retirement terms at least. Working in retirement will keep paychecks coming and hopefully provide you with  benefits such as health insurance and retirement account contributions. Finally, continuing to work may also provide you the ability to delay claiming your Social Security benefits – for each year up to 70, your increase by about 8%.
  • Another strategy that can be taken to plan for a successful retirement is the Social Security claiming strategy. As mentioned above, delaying your social security benefits will result in an 8% increase each year. It may also be possible for one spouse to begin drawing half of the other spouse’s Social Security benefits while still delaying his or her own claiming date (and thus enjoying those 8 percent annual benefit increases).
  • Taking a reverse mortgage could be they key to plan for a successful retirement. A Reverse Mortgage, or Reverse Home Mortgage, is a great financial product for seniors to use in their retirement plan.When looking for ways to get cash from their home, most people consider selling their house or borrowing against their home equity and making monthly loan repayments on a home equity loan. To be eligible for most Reverse Mortgages, you must own and reside in your home and be a senior 62 years of age or older. (In most cases second homes, apartment buildings and homes less than a year old are not eligible for a reverse mortgage.)
  • Spending retirement assets is another consideration to take into account when planning for retirement. The standard advice given by a financial adviser is not to spend more than 4% of your assets a year. However, in reality, whatever number makes sense to you needs to be accompanied by a strategy to actually manage your retirement assets to produce whatever level of payouts you’ve selected.

Resources:

Continue here to find a prescreened Reverse Mortgage lender

 

Use our free Newretirement Retirement Calculator to plan for a safe retirement

—–> https://www.newretirement.com/retirement-calculator/default.aspx

Use our free Reverse Mortgage Calculator to see how much you qualify for

—–> https://www.newretirement.com/Services/Reverse_Mortgage_Calculator.aspx

Use our free Social Security Calculator to find out when is the best time to take your benefits

—– >https://www.newretirement.com/Services/Social_Security_Start_Age_Calculator.aspx


Click here to be matched up with a financial advisor to help you plan for a safe retirement

 

 

UPDATE: Reverse Mortgage Lender NOW Offering Loans on Mobile Homes

If you own a mobile home and are interested in a Reverse Mortgage, good news!  We have found a lender who is now offering Reverse Mortgages on mobile homes.

However, to qualify you must own the land on which your home exists – the land cannot be leased — and your home must be:

  • A doublewide sized at 800 square feet or larger
  • Built after 1996
  • On a permanent foundation

RESOURCES:

 

MetLife to stop offering Reverse Mortgages

MetLife Inc. owned over 20 percent of the reverse mortgage business in the U.S., according to Reverse Mortgage Insight, and On April 26, the largest U.S. life insurer and reverse mortgage lender sold its reverse mortgage business as part of its exit from banking-related activities to Nationstar Mortgage LLC. Chief Executive Officer of MetLife, Steven Kandarian, has also agreed to sell about $7.5 billion of deposits to General Electric Co. (GE) and said in January he would stop originating traditional home loans. This announcement came immediately after MetLife reported a $174 million net loss for the first quarter, amounting to 16 cents per share and compared with a profit a year earlier of $701 million, or 66 cents per share. This sale could have been foreseen, as MetLife had been actively shedding its banking and mortgage operations to drop its bank holding company charter.

 



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