Your Questions About Reverse Mortgage

Mark asks…

Is a Debt Consolidation Loan possible with a Reverse Mortgage already in place?

admin answers:

They are not related to each other in any way unless you are trying to secure your new loan with your home – which might not be possible.

Helen asks…

Do you have to show income for a reverse mortgage?

Just wondering about income qualifications are?

admin answers:

No income, you have to show that you have equity in your home.

Steven asks…

Is Interest accrued on a reverse mortgage tax deductable?

admin answers:

Not until the reverse mortgage is paid off. I’ve included a link that helps explain a reverse mortgage.

Donald asks…

How can I get out of a reverse mortgage????

Too late realized mistake of reverse mortage

admin answers:

You would not only need to pay off the amount you collected, there will prob be interest, closing costs, and maybe a penalty. Contact lender for your options.

Michael asks…

Any in for or advice for seniors on one fixed income needing a reverse mortgage or loan modifier.state CA?

Recently widowed senior of 56 years living in home with an adjustable loan at 7% interest and owing more than home is worth.

admin answers:

In order to qualify for a reverse mortgage you must be al least 62 and have substantial equity in your personal residence.
If you have further questions AARP is a good (and free) source.

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Your Questions About Reverse Mortgage

Mary asks…

How can I use reverse compound interest to pay off my 30 year mortgage faster?

Instead of using an expensive company to tell us when and how to pay off our mortgage faster, Is there a way I can figure out the formula myself? I want to pay off our mortgage quickly by using reverse compound interest.

admin answers:

You are over thinking it. Just pay extra whenever you can.

Charles asks…

If I have a reverse mortgage can I still get a second mortgage for debt consolidation?

admin answers:

Magoogan, while I’m not an expert, generally you should avoid getting a mortgage, especially since you have a reversed mortgage and are already in debt, it seems. In a way, you seek to incur debt (i.e., get another mortgage) to pay down other debt, which is not the way to go.

How much is your current debt that you seek to consolidate? Are there ways you can try to pay off the debt without getting yet another mortgage–like,for example, sacrificing some things in order to save up money to put towards paying down the debt on your own? Have you met with a local financial expert to see what your options are? I’m sure they vary by location.

Listen, here’s an informative article on tips to avoid mortgage defaults, and one of them includes what you are doing–realizing and not ignoring that you have a financial crunch, which you seek the fix:

http://yourhandymanzone.com/Your_Handyman_Zone_How_To_Pages_Real_Estate_Zone_Buying_Your_House_Mortgage_Default_Avoid_Foreclosure.htm

Hope you find this helpful, and that you get through your financial troubles.

Good luck!

.

Source(s):
The Internet. Just whatever is available online and what I have on my mind, including the inclusion of relevant sites, like the one cited that came into existence from my efforts, which is intended to be useful. Helping people get the relevant info they want is great.

Susan asks…

Is a Reverse Mortgage a safe loan?

My neighbor told me about these reverse mortgage loans and I wanted to ask here if this a safe way to get some cash out of my home. I live in Ft. Lauderdale, Fl. and am retired 6 years now.

admin answers:

A reverse mortgage is a really great thing if you have lots of equity in your home, and you don’t have very much liquidated cash to enjoy your retirement. My mother had a house paid in full in Santa Barbara, CA but was living off of social security checks. I helped her get a reverse mortgage loan from Financial Freedom. Then she was living life to the fullest until she passed away 6 years later. My siblings were livid when they found out she got that loan, because they thought she would eat up their inheritance. But she sure loved life those last years of her life, going to the off-track horse racing, bought a new car, new hi-def tv, remodeled her kitchen with Viking appliances. So, yes it can be a very good thing. But you must remember that it is basically selling your house slowly back to a financial institution. If my mom would have lived long enough, my brother and sister (and me) would not have inherited a dime, but that was ok with me.

Anyways, you can find some info and resources about reverse mortgages here:

http://reversemortgageresource.blogspot….

_____________

Michael asks…

Is a Reverse Mortgage a safe loan?

My neighbor told me about these reverse mortgage loans and I wanted to ask here if this a safe way to get some cash out of my home. I live in Ft. Lauderdale, Fl. and am retired 6 years now.

admin answers:

A reverse mortgage is a really great thing if you have lots of equity in your home, and you don’t have very much liquidated cash to enjoy your retirement. My mother had a house paid in full in Santa Barbara, CA but was living off of social security checks. I helped her get a reverse mortgage loan from Financial Freedom. Then she was living life to the fullest until she passed away 6 years later. My siblings were livid when they found out she got that loan, because they thought she would eat up their inheritance. But she sure loved life those last years of her life, going to the off-track horse racing, bought a new car, new hi-def tv, remodeled her kitchen with Viking appliances. So, yes it can be a very good thing. But you must remember that it is basically selling your house slowly back to a financial institution. If my mom would have lived long enough, my brother and sister (and me) would not have inherited a dime, but that was ok with me.

Anyways, you can find some limited info and resources about reverse mortgages here:

http://reversemortgageresource.blogspot.com

If I were you I would just do a Google search for “HUD Reverse Mortgage” or “Financial Freedom”
_____________

Betty asks…

Anypne interested in talking about the pros and cons of a Reverse Mortgage?

admin answers:

The most popular Reverse Mortgage is the Home Equity Conversion Mortgage (HECM) which account for over 90% of Reverse Mortgages done to date. The HECM is Federally regulated and insured (FHA—HUD) They set the rules and regulations. AARP just released a study
(12-12-2007) here’s the web address that will link you directly to the report on AARP website…

Http://www.aarp.org/research/credit-debt…

You can also go directly to www.HUD.gov to research Reverse Mortgages. Seeing it’s their program why not go right to the source. Part of the Reverse Mortgage process is that you have to talk to an independent HUD approved third party counselor to make sure you understand the program and that it was explained to you correctly. (government safeguard). There is no charge for this and you can do this anytime you want. Just another avenue to answer your questions. I hope these resources help in your decision making. If I can be of any other assistance let me know. For disclosure purposes……I have been in the Reverse Mortgage business for over 2 years and I am a Reverse Mortgage Consultant for EverBank Reverse Mortgage, feel free to contact me with any other questions you have.

Regards,

Stephen

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Your Questions About Reverse Mortgage

Ken asks…

Reverse Mortgage or second home loan?

I need to replace the roof, lawn sprinklers and other around the home issues. Which one are better and who to contack. FYI: I racing against the clock here.

admin answers:

How old are you? How much equity do you have in your home?

Those would be facts that you would need to make your decision, we can’t answer it based on what you want to spend the money on.

Paul asks…

Are there any circumstances that would help qualify a 55 yr old man on disability for a reverse mortgage loan?

The house is completely paid for. He’s not yet receiving social security although the application is being processed. Chronologically he’s 55, but the doctors have put his physical age closer to 70 due to the many, many health and mental conditions.

admin answers:

I’m sorry but FHA/HUD is very strict on the 62 age requirement. As someone else mentioned you may look into a home equity line of credit as an alternative. When he’s 62 you can then do a reverse mortgage and pay off the HELOC.

Feel free to contact me if you have any other questions.
Bburns@griffinloans.com

Helen asks…

i have a reverse mortgage without a clear title?

the figures that i was given was not the figures that was used for the reverse mortgage which opted me to have no money at the time of closing which i think was deceptive

admin answers:

This is not unusual, especially with internet lenders. You have to talk to the loan officer or mortgage broker who prepared the loan documents.

Ruth asks…

What happens in a reverse mortgage and all the money is spent but the elderly people are still alive?

The amount of the loan is $200,000.00. The house was valued at $490,000.00.

admin answers:

Nothing happens

with a reverse mortgage the homeowner can stay in the house until they die and never have to make a payment.

If they are getting a monthly income from the reverse mortgage they also have to recieve it until they die or move out.

Reverse mortgages are designed so they can’t hurt the senior

Lizzie asks…

Exactly how does a reverse mortgage work?

admin answers:

Basically you take out a loan against the value of your home. The bank gives you cash in return for a payment that they expect when the owner dies, sells the house or vacates the home.

Unlike a traditional mortgage, the home owner makes no monthly payments. All the interest on the amount the bank lends you is added to the lien on the property and it’s all paid out upon those events I mentioned.

These used to be marketed to older people who need immediate funds to live on, but don’t want to retain the equity in their homes for their estates or future generations. Thing is, they are under some scrutiny for marketing and pricing practices. Make sure you do some research and understand fully the consequences…

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Your Questions About Reverse Mortgage

Sharon asks…

Who would I talk to re: getting a reverse mortgage on a house in Lassen County, Calif.The house is paid for.?

My mom passed away and my brother and I own the house. It is for sale, but I would like to buy my brother out.

admin answers:

Hey, I just happen to know where Lassen County is!

As the others said, you don’t want a reverse mortgage in this situation. Talk to a reputable lender in your area about the best options available to you.

Robert asks…

how many of you taken a reverse mortgage on your home? was it a good thing? or a bad thing? ?

I’m 63 and wife is 59 both names on loan for house. Need to pay medical bills. Thought this be a good way to go. My house is worth about $90.000 My wife is unemployed and I’m on disability.

admin answers:

You can certainly take out a reverse mortgage, but examine very carefully the obligations which will come with such a situation. In a reverse mortgage, you are borrowing monies against your ‘equity ownership’ in the property. Assume the lender gives you $80,000 against your ownership. You are expected to pay it back to the lender at some point, in order to again have full ownership.

My guess ? I’d venture you are far better off to attempt to make repayment arrangements with the medical providers involved.

Mandy asks…

Is it possible to get a HELOC on an existing Reverse Mortgage?

admin answers:

In theory yes, but in reality no.

The Reverse Mortgage is the primary mortgage. It continues as long as the homeowner lives in his home. Thus the debt continues to rise and equity falls.

The HELOC is based on the remaining equity. Since it’s shrinking, why would anyone lend based on it.

Laura asks…

What do mortgage bankers think about reverse mortgages?

admin answers:

They get paid either way.

Ruth asks…

To old to get a reverse mortgage at 62 but to young to get a personal loan! anyone got any ideas ? Melbourne!?

my mum is 62 and can’t get a personal loan at her age but most reverse mortgage companies require you to be 65 or older! she is looking at getting a car very soon but is stuck about ideas on what to do! anyone got any ideas? where from melb Victoria!

admin answers:

Does you mum own a house or property? She can sell the property on Vendor Terms, then she should be able to have enough money to buy the car.

BTW, Vendor terms is where the owner of a property offers to finance the purchase of that property. The person who buys the property does not gain legal ownership of the property until the final installment on the property has been paid.

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Your Questions About Reverse Mortgage

Richard asks…

What would be the advantages and disadvantages of a reverse mortgage.?

admin answers:

Advantage:
– allows equity in home to be converted to cash flow by borrowing with no monthly repayment (repayment due at maturity … Presumably by liquidating the collateral) or with interest only payments
– this can be a useful mechanism, particularly for older ‘property rich/cash poor’ persons to augment their cash flow … However …

Disadvantage:
– at some point, the equity in the collateral property is fully borrowed and a large balance is owed against it (ie borrower has little or no remaining equity in the property)
– in the case of an older borrower, this means a smaller estate to pass along and the risk of outliving the cash flows from the reverse mortgage … Which translates to no house, no more borrowing capability, no more cash flow, no more,no more, no more

David asks…

Is the NewDay Reverse Mortgage loan a scam?

My grandma received a letter from this company in the mail the other day and it talks about her being pre-approved for a lump sum payment, and I really don’t believe them but they even say they are a government insured program.

admin answers:

Junk mail. Never do business with anyone that calls you or sends you mail.
These will always be the worst companies to deal with.

Reverse mortgages are common, but a much better idea is to sell the home he is in and buy a smaller place or even rent something he can easily afford.
Reverse mortgages are one of the worse financial decisions a person can make.
The charges and fees will eat him up alive.

Ruth asks…

does anyone have any information on a reverse mortgage?

Is it a good deal? what are the advantages and disadvantages?

admin answers:

NO, it is a bad deal. You are pretty much giving your house away and you could end up with no assets and many more years to support yourself.

Joseph asks…

To Seniors who have engaged in a Reverse Mortgage with a bank (not with a broker) -?

have you had any negative experience, especially at closing it out? Mine is new, but I am not totally comfortable with the possible outcome at payoff.

admin answers:

One woman I know at age 84 did one. Lender required home improvements, with their contractor. Contractor charged $45,000.00, taken out of the reverse mortgage. The only work done was replacement of five 4’8′ ‘posts’ on her front porch, and painted, and three wooden grab bars were installed at her three doors. That’s a $44,000.00 rip off.

James asks…

Is reverse mortgage just a selfish way banks steal your inheritance?

admin answers:

They can’t steal your inheritance, they can only lend money on property owned by the person who wishes to borrow it. If the property belongs to you they would not be able to do that. You are not entitled to anything of your parents, they are entitled to use their assets as they see fit.

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Your Questions About Reverse Mortgage

Robert asks…

What is a reverse mortgage, and who are eligible?

admin answers:

Some of the other posts are wrong.

A reverse mortgage is a special loan designed for seniors, aged 62 and older, that allows homeowners to borrow money without having to make any payments until they sell or pass the home onto their estate. With a reverse mortgage, the bank pays you versus you paying the bank. Reverse mortgages differ from traditional home equity loans and mortgages as you do not make any monthly mortgage payments for as long as you stay in the home.

To be eligible for a reverse mortgage you must meet the following qualifications:
a) You and everyone else on the title of your home must be 62 years old or older.
B) You have little to no mortgage on the property.
C) Your home is your primary residence.
D) Your home is in good condition.
E) Your home is a single family; two to four family; condo; or townhouse. Some manufactured homes and 55+ associations also qualify.
F) You expect to stay in your home for a number of years.

You can receive your payments as a lump sum, monthly payments, a credit line, or a combination of all three.

The bank never takes your house. That is a myth

Your reverse mortgage loan becomes due and must be paid in full when one of following conditions occurs:
a) the last surviving borrower passes away or sells the home;
b) all borrowers permanently move out of the home;
c) the last surviving borrower fails to live in the home for 12 consecutive months;
d) you fail to pay property taxes or insurance and do not correct the problem;
e) you let the property deteriorate, beyond what is considered reasonable wear and tear, and do not correct the problems.

You or your heirs keep the net proceeds from the sale after the loan balance is paid. The bank does not take your house.

Betty asks…

How can I go about obtaining a reverse mortgage?

admin answers:

A “reverse” mortgage is a loan against your home that you do not have to pay back for as long as you live there. With a reverse mortgage, you can turn the value of your home into cash without having to move or to repay the loan each month. No matter how this loan is paid out to you, you typically don’t have to pay anything back until you die, sell your home, or permanently move out of your home. To be eligible for most reverse mortgages, you must own your home and be 62 years of age or older. More information about reverse mortgages can be found here……

Http://reversemortgageresource.blogspot.com

________________________

Laura asks…

Reverse Mortgage and Last Will and Testaments?

In this case an original will was made to give an estate to one person as the main heir and if the main heir dies then the second heir will receive the estate. The owner did a reverse mortgage on her home and gave the money to the main heir before she died. If there is no money left after the first heir dies; can the second heir sue the main heir’s children? Did the will become null and void after the owner did the reverse mortgage and gave the money to the main heir? We live in Virginia. Please help….

admin answers:

A will is directions for how to dispose of whatever property remains in the estate upon the death of the testator. If there is nothing in the estate, that is too bad. Everyone is free to give away their property before they die. For that matter, a will can be changed at any time and therefore means nothing until the person is dead.

Linda asks…

If someone did a reverse mortgage on their home will it show up on the Board of Tax Assessors?

admin answers:

Dusty forgets that real estate folks obtain the information from the tax assessor. LOL

Yes, the tax assessor knows the bank and the original mortgage amount, but not balance. They also are informed as soon as an owner defaults.

Carol asks…

I have a mortgage note and they said they are getting a reverse mortgage on it. Is this legal?

they are under sixtytwo and are not living in the mobilehome.

admin answers:

Well it can’t be a government backed reverse mortgage. If they aren’t living there, they don’t qualify.

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Your Questions About Reverse Mortgage

Richard asks…

Can anyone explain what a reverse mortgage is and if it’s a good idea?

I heard that it’s good if you have no children to leave anything to. Any help will be greatly appreciated..Thank You!
Thank you all…very informative info…I have no debt and I have no children to leave it to. My extended family will still receive a substantial amount without the house. Do these facts make it a better idea?

admin answers:

Reverse mortgages can be an excellent income solution for retirees with very specific needs. They are obviously not for everybody, however. I would consider it as last resort. If you want to bequeath to you heirs it’s probably not the best idea.

“The purpose of a reverse mortgage is to have an added source of income, especially if you plan on selling your home near the end of your life or after you die. It allows you to receive the equity from your home and enjoy it in retirement. The amount you receive in the reverse mortgage is based on the value of your home, current interest rates, and your current age. Once you’ve received the amount your home has been determined to be worth, less any fees charged by the lender, you then owe that amount to the lender. You can pay that back any way you wish, but in many cases, the idea is to sell your home and repay the debt. Often, this is done by an estate after a person passes away and still has debt. As long as you’re permanently living in your home, you don’t have to pay the lender back.”

See this Reverse Mortgage Article for more detail on how they work:
http://www.themoneyalert.com/ReverseMortgageArticle.html

Paul asks…

How can I get a monetary hand in the Reverse Mortgage business if I am not a licensed broker?

admin answers:

Depends on your state. Get a salesperson’s license and work for a licensed broker who has the connections with the reverse mortgage lenders and HUD. If you don’t want to get a license, then work as an employee for a bank. Or work for one of the internet shops and work across state lines.

Laura asks…

What is a reverse mortgage and do you advise it as a retirement option?

My friends were looking into getting one and I did not understand what it was. It sounds like it isn’t much different than a “second mortgage” that you receive in payments instead of in one lump sum, paying interest on this loan all the while. Correct?

admin answers:

A reverse mortgage can be a good source of income for someone who needs addtional money and can’t get it from anywhere else. Your home equity is used as income. You do not make monthly payments you receive them. Sometimes you can also get a lump sum if needed.

Maria asks…

Reverse Mortgage value Bankers will consider?

I purchased a flat in 2005 for Rs. 20 lakhs and now in 2008 the market value for the same is almost doubled in our area.

What value will the Bankers take for consideration-will it be purchase value or market value?

admin answers:

In the US a year after purchase the purchase price makes no difference anymore. They would only consider the current market value (for good or bad).

I don’t imagine your country would be much different.

William asks…

How does a reverse mortgage work?

admin answers:

Rabbi,

I’d be glad to send you a lot of information about reverse mortgages but here are the basics. It’s an FHA loan for only people 62 years or older. You can get out 45%-75% of your home value depending on your age. The older you are the more money you receive. It’s similar to a home equity loan but the biggest difference is that with a Reverse there are no monthly payments to make. The lender is willing to wait 20-30 years for the borrower to either pass away or move from their home in order to get paid back. It’s much safer than a home equity loan because there are no monthly payments to add on or fear of foreclosure because payments have been missed. You can receive your money in a lump sum, monthly payments, a line of credit (with a growth rate of about 7% right now), or a combination of all three. There are no income or credit requirements. You are still the owner of your home and remain on title just like you would with any other kind of loan.

The only drawback to it is that you don’t leave 100% of your equity to your heirs.

If you have a current mortgage a reverse can pay off your current mortgage and you receive the remaining money you qualify for thus eliminating your monthly mortgage payment on the current loan.

I hope that answers the basics. I specialize in reverse mortgages and would be happy to send you an information packet we have. You should also check out these websites.

Www.reversemortgage.org
www.aarp.com
www.griffinloans.com

Our company is the largest originator of reverse mortgages in the Southwest and we are licensed in almost every state. I’d be more than happy to help you with any questions you may have. Feel free to respond back to this post or you can email me direct at bburns@griffinloans.com

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Your Questions About Reverse Mortgage

George asks…

What exactly is a “Reverse Mortgage” and what are the advantages and disadvantages?

admin answers:

The advantages are for the mortgage company and the disadvantages are for the homeowner. Stay away from this product it is full of fees and is usually a ridiculous interest rate.

Thomas asks…

Can you get downpayment assistance from the state of california or the federal govt for a reverse mortgage?

Is there such a program?

admin answers:

I think you do not understand reverse mortgages. If anyone tell you there are fees or a down payment needed for a reverse mortgage they are lies and cheats. Don’t walk – RUN away from them! Reverse mortgages, however, are rarely a good idea.

Here is what is supposed happen – you enter into a reverse mortgage say at age 70 on a 100K house. They think you will likely live another 15 years at most and they offer to pay you $450 a month for life. If you live longer than that they keep paying, however, if you doe they get the house without making anymore payments to your estate. So if you die after 1 year you loose the house.

A better option in most cases is to simply take out fixed rate second mortgage and use some on the money to make payments. This get you money you need and also helps protect the asset for loss if you do not live as long as you hope.

You need to talk to a financial planner – check to see if you bank has one and make sure this is a good idea for you

Daniel asks…

What are the pitfalls of a reverse mortgage,on a fourplex, that they live in?

admin answers:

Your question is somewhat vague, but I’ll try to give you an answer the best I can relating to revers mortgages! I don’t know how the fourplex has anything to do with it, but a reverse mortgage is instead of making payments on your house, you get the equity out of it without having to make payments!

A reverse mortgage can be great for a retired person who still wants to live in their own home who will most likely pass away before another move.
After the homeowner dies, the immediate family inherits the home and decisions have to be made because the family or beneficiary to the will have to either sell the home or pay back the amount taken out as equity in a reverse mortgage within a years time!

It is my understanding that this type of mortgage can only be used by a person in a single family residence and if your family member has a fourplex with a reverse mortgage on it, then rules have changed!

I would think rental income from the fourplex, even if the family member was living in one unit, would be enough to sustain them in their own home!

I would also do what ever you can to save and keep that piece of property bbecause a piece of income producing property is a great asset to have and keep in the family as long as members of the family can get along and maintain it!

The biggest pitfall of a reverse mortgage is the beneficiary of the person who passed away will have to pay ALL the money back with interest when the family member dies. You can put a new mortgage on the property and take out enough to pay off the cash amount the reverse mortgage paid out and this is how most people get out of the reverse mortgage, but you MUST do this within 12 months after the property owner is gone and you inherit it!

I hope this helped you!

Steven asks…

Can anyone out there respond to a question I had from a friend about reverse mortgage.?

She sent me a spreadsheet with 5 different choices. I need an opinion of which one is the best for her mom.

Pleae let me know your e-mail so I can send the spreadsheet.

admin answers:

Don’t do a reverse mortgage. It’s the worst thing an older person can do… Their home will just be stolen from them eventually.. Ugh bad idea

Robert asks…

Have any senior citizens ever taken out a reverse mortgage?How did it work out?Are you glad you did it?

I am considering getting one.I think everything has a down side,but I haven’t found one yet in that program.

admin answers:

The most popular Reverse Mortgage is the Home Equity Conversion Mortgage (HECM) which account for over 90% of Reverse Mortgages done to date. The HECM is Federally regulated and insured (FHA—HUD) They set the rules and regulations. AARP just released a study
(12-12-2007) here’s the web address that will link you directly to the report on AARP website…

Http://www.aarp.org/research/credit-debt/mortgages/2007_22_revmortgage.html.

You can also go directly to www.HUD.gov to research Reverse Mortgages. Seeing it’s their program why not go right to the source. Part of the Reverse Mortgage process is that you have to talk to an independent HUD approved third party counselor to make sure you understand the program and that it was explained to you correctly. (government safeguard). There is no charge for this and you can do this anytime you want. Just another avenue to answer your questions. I hope these resources help in your decision making. If I can be of any other assistance let me know. For disclosure purposes……I have been in the Reverse Mortgage business for over 2 years and I am a Reverse Mortgage Consultant for EverBank Reverse Mortgage.

Regards,

Stephen

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Your Questions About Reverse Mortgage

Richard asks…

What is the best place to get a reverse mortgage?

admin answers:

You want to speak to multiple HUD approved reverse mortgage lenders who have experience. We have an excellent resource below.

Mary asks…

With a senior reverse mortgage, when and how are the fees expected to be paid to the provider.?

I am 64 ( retired ) and my wife is 59..We are both on the original mortgage which is paid off. To qualify she will be taken off the co-ownership of the house. We are doing this because we are broke except for my social security check so we couldnt pay any fees until the loan was in our hands. We live in Tx. and our house is in great shape and recently valued at about 125,000. Can someone please tell me what to expect?

admin answers:

Fees will be about $5,000 and will essentially be due when the loan comes due. (Make sure you get adequate life insurance so your wife won’t lose the house if you predecease her.)

William asks…

How does a reverse mortgage work, and who issues them?

admin answers:

A “reverse” mortgage is a loan against your home that you do not have to pay back for as long as you live there. With a reverse mortgage, you can turn the value of your home into cash without having to move or to repay the loan each month. No matter how this loan is paid out to you, you typically don’t have to pay anything back until you die, sell your home, or permanently move out of your home. To be eligible for most reverse mortgages, you must own your home and be 62 years of age or older. More information about reverse mortgages can be found here……

Http://reversemortgageresource.blogspot.com

________________________

Donna asks…

What is reverse mortgage & how is it different from mortgage?

admin answers:

A reverse mortgage is specifically designed for the needs of seniors and keeping them in their homes, whereas a traditional mortgage is not structured for that purpose.

With a traditional “forward” mortgage, all the money is borrowed up front and paid off over time with monthly payments. Over time the mortgage balance decreases as each monthly payment is made.

With a reverse mortgage the money is borrowed over time and is not paid off until the borrower either permanently leaves the house or passes it on to their estate. No payments are made until then. With a reverse mortgage the bank pays the borrower versus the borrower paying the bank. The balance increases over time with a reverse mortgage.

Reverse mortgages are not scams. Reverse mortgages are a good thing that helps many seniors stay in their homes versus prematurely going to nursing homes, etc. Reverse mortgages by the way are also almost entirely misunderstood and the same false information is repeated again and again.

All the borrowers must be 62 years old or older. Unlike traditional mortgages, credit is unimportant as no payments are being made. You also do not need income to qualify for a reverse mortgage as you do with a traditional mortgage, as no mortgage payments at all are being made. The reverse mortgage gives the borrower income versus using their income to make mortgage payments.

Reverse mortgages also allow for life estates and trusts to protect the equity in the home from Medicaid reimbursement, which is not allowed with traditional mortgages.

For more information go to: http://www.mtgmortgages.com/reverse_mortgages/reverse_mortgage_resources.htm

James asks…

My father died 2 yrs ago, I recently found out that he may have a house with a reverse mortgage,now what?

I have found no paper work about the property and was recently contacted by the city who want the house condemned. I am only heir but have never filed any paper work as there was no other assets to my knowledge..where do I start? I don’t want to get involved if the house I owned by the bank/mortgage company.

admin answers:

You need to find out who does currently legally own the house, how much it is worth, what bank (if any) holds the mortgage, how much equity there is in the home, and where you would stand both financially and legally if you sell it. Even if the house itself is condemned, the property it sits on must be worth something — possibly quite a lot.

Since you don’t seem inclined to look into any of these matters yourself, I suggest you give whatever information you have to a real estate lawyer and let him/her research the situation for you. You’ll have to spend a little bit of money to do this, but you might wind up gaining thousands.

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Your Questions About Reverse Mortgage

Chris asks…

What are the pros v. con on getting a reverse mortgage?

I believe her thinking is that the equity paying off the house would be a good idea. I’ve tried to see the advantage in it, but for some reason I just can’t make the numbers work. Also, if the equity is paying off the house who then “owns” the house since she is no longer paying the mortgage anymore. Any and all advice is greatly appreciated! Thanks and HAPPY NEW YEAR!!

admin answers:

The most popular Reverse Mortgage is the Home Equity Conversion Mortgage (HECM) which account for over 90% of Reverse Mortgages done to date. The HECM is Federally regulated and insured (FHA—HUD) They set the rules and regulations. AARP just released a study
(12-12-2007) here’s the web address that will link you directly to the report on AARP website…

Http://www.aarp.org/research/credit-debt…

You can also go directly to www.HUD.gov to research Reverse Mortgages. Seeing it’s their program why not go right to the source. Part of the Reverse Mortgage process is that you have to talk to an independent HUD approved third party counselor to make sure you understand the program and that it was explained to you correctly. (government safeguard). There is no charge for this and you can do this anytime you want. Just another avenue to answer your questions. I hope these resources help in your decision making. If I can be of any other assistance let me know. For disclosure purposes……I have been in the Reverse Mortgage business for over 2 years and I am a Reverse Mortgage Consultant for EverBank Reverse Mortgage. Also Federal law requires that the homeowner MUST remain on title, thus maintaining ownership of the home.

Regards,

Stephen

Sandra asks…

WHY VARIOUS CONDOS IN PUERTO RICO ARE OUT OF REVERSE MORTGAGE TRANSACTIONS?

I am 64 years old, i have an apartment that not cualifian to a Rverse Morgage transaction.

admin answers:

You might not have enough equity (money) in your home.
They are getting much more strict.

Did you know that a reverse mortage is one of the top 10 worst financial mistakes a person can make?
If you ever decide to move out, you will have nothing – absolutely nada to your name.
You may want to move out around age 80 if you fall and break a hip and can no loger move around to cut grass or drive around. Chances are VERY slim you will stay in your home forever.
Plus reverse mortgages are super, incredible expensive.

Why not sell your home, and move into a very small apartment instead.
That way you will have plenty of cash that you can retire more comfortably on.
Talk to an investment company like Charles Schwab or Fidelity and ask them about CD annuities.
They pay out monthly into your checking account and are super low cost.
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Laura asks…

Can you sell a reverse mortgage and still have your name on the loan?

Can the title be in someone else’s name? Some retired lady, wants me to give her $30K and I keep paying her mortgage of $850. It’s a good price for the area, but can it be done? Is there anything I should do (besides leaving) to protect myself, I don’t have an agent or anything, should I get a lawyer? Please answer any and all questions you can!

Thanks

admin answers:

No. If she has a reverse mortgage, she gets paid by the mortgage company and she does not make payments on the mortgage at all. She would then be getting paid by the mortgage company from the reverse mortgage, collecting money from you and you would be giving her 30k up front that she would be getting. If you are seriously interested in this home, I strongly recommend you retain an attorney to help you. You can probably get an attorney to help you out for as little as a couple hundred dollars. Once ownership interest in a home changes at all for a person with a reverse mortgage they have to immediately notify the lender at which time. Wells Fargo specializes and is an industry leader when it comes to Reverse Mortgages. Contact someone at Wells Fargo and explain the exact situation and see what they think if you want to save the attorney fee.

Michael asks…

What problems can I encounter with a reverse mortgage.?

I need repairs to my home, which I intend to stay here. But I cannot afford the expense at this time.

admin answers:

This is an excerpt from Smart Money.

“The problem with reverse mortgages? First, they don’t come cheap. There are origination fees of up to $6,000 on a Fannie Mae loan, for example, and closing costs as high as $12,000 on a $150,000 loan. Also, your folks will face a lengthy application process that includes, among other things, mandatory counseling. Diana E. Watkins, a professor in Santa Clarita, Calif., had to wade through streams of paperwork to help her mother,

Esther Ormston Sell, pull $135,000 from her home last year. Then, on the day of the signing, they couldn’t close because Sell had no picture ID (she had never worked or driven a car). “The banker told me that this is one of the biggest problems with women of my mother’s generation,” says Watkins, whose mom’s attorney had to vouch for her identity.

You’ll also have to use good judgment when considering a reverse mortgage. Given the costs of the loan, it is not a prudent way to cover short-term cash-flow needs. And sometimes it simply makes more sense to sell the house. For example, if your parent is diagnosed with a terminal illness and has only a couple of years to live, selling the house would provide more cash than a reverse mortgage, says Tom Scabareti, vice president at Financial Freedom. ”

This one is another informative one: http://itsjustmoney.blogs.com/its_just_money/2006/08/reverse_mortgag.html

Donna asks…

is there a minimum loan amount in a reverse mortgage?

My dad wants to take out a lump sum of like 4 grand or 5 grand maybe 10 grand at most. We own the house, I want to talk him out of it, this was one of his questions. Also if you can supply me with a whole bunch of really good reasons why this is a bad idea, that would be great. Thank you!

admin answers:

He wants a home equity loan, not a reverse mortgage.

In a reverse mortgage the bank basically buys the home from you with monthly payments. They do not just give you some money and not expect it back.

Because he wants so little a personal loan would be easier then a second mortgage.

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