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

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.
/

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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Your Questions About Reverse Mortgage

Mary asks…

Where can I get the best Reverse Mortgage loan?

I get a lot of offers in the mail since I looked into it.

admin answers:

I found this website for you on that topic. Seems to have links to the best Reverse Mortgage lenders:

http://reversemortgageresource.blogspot.com

Sandra asks…

how do you get out of a reverse mortgage? My grandfather has one on his house and is gravely ill.?

What can we do to reverse things prior to his passing?

admin answers:

He likely is not in any shape to get a new loan, he will not qualify.

The only way to get out of the reverse mortgage is to repay it in full. There should be statements available. Showing how much he was given.

Paul asks…

my husband is 65 and I am 54. If we went with a reverse mortgage, what would happen if my husband died before?

Our only income is from Social Security. Including taxes and insurance our house payment is nearly $900.00 a month. We really don’t have any equity in our home since price went into the bucket. We will never own our home. Any information or guidance?
W are considering a reverse mortgage.Our mortgage is too high. We can not refi because debt to income is too high.

admin answers:

Reverse mortages are one of the worst financial mistakes a human being can make.
Only next to buying a time share.

If you have no equity, the bank isn’t going to give you anything each month.
They can only give you what you have in equity back over the years.
Google “reverse morgages complaints”
/

Sandy asks…

whats your thoughts on reverse mortgage for senior citizens?

My dad thinks he might want one are they really a good idea?

admin answers:

My in-laws have recently acquired a reverse mortgage and it is providing them with extra income every month. You can either draw out the whole equity at one time or take it in monthly payments.

Be sure to read all the fine print regarding who ever your father deals with.

An as to “them getting the house” well that is not true.
Here is how it works regarding any heirs:
When you sell your home or no longer use it for your primary residence, you or your estate will repay the cash you received from the reverse mortgage, plus interest and other fees, to the lender. The remaining equity in your home, if any, belongs to you or to your heirs. None of your other assets will be affected by a reverse mortgage loan. This debt will never be passed along to the estate or heirs.

Hope this answer is of help to you
LEGAL DISCLAIMER: The answer provided here is intended for informational purposes only. It is not intended nor presumed to be legal counsel or professional legal advice

Lizzie asks…

Is a reverse mortgage a good loan if my house is paid off?

And who issues them besides HUD?

admin answers:

It can be if you are either struggling financially, or simply want to have more funds to enjoy retirement.

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

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Your Questions About Reverse Mortgage

Chris asks…

How can someone find out if a relative got a reverse mortgage on their home?

admin answers:

Obviously you can’t ask them! If you have a friend that is a Real Estate Broker, they have access to certain types of data bases that you and I cannot check — Have R.E. Check by address of house for current name of mortgage company. Not all mortgage companies handle R.M. – these are Federal charter banks. By the name of the Mortgage company you will know if its a R.M.

Maria asks…

Does anyone know how a “REVERSE MORTGAGE works?

My mohter in law wants to take out a reverse mortgage on their house. They own it free and clear and they are both retired. They want the money to travel, vacation etc.

someone told me that it is not very cost effective and that they should just re-fi.

Any info on this subject would be helpful.

admin answers:

First of all, you have to meet a certain age limit to be qualified for a reverse mortgage. Depending on the program or lender would determine the age limit, however I do believe it starts at retirement age.

Secondly, the lender will only payout to a certain percentage of the value of the home. Again, this depends on the lender and the program. Most will perform to 50% of the value of the home. I have seen some as low as 40% with some being as high as 60%.

Third, the monthly income would determine the life expectancy of the individual. If the person is 66 years of age with a life expediency of 85, then there is 19 years that they will receive payment (as long as they do not exceed the value threshold).

So the example would be this:
Example 1
500,000 value owned free and clear
250,000 dollars allowed to be drawn on
1,094.49 dollars in income(19yrx12m=228m/250,000 dollars)

Example 2
500,000 value w/ 100K lien
150,000 dollars allowed to be drawn on (100K-250K (50%))
657.89 dollars in income (same formula as above).

Each time a payment is conducted, you will incur interest on that payment that will be compounded monthly. Hence the reason for the low LTV (loan to value) ratio.

Once the borrower passes away, you will have a certain amount of time to repay the lender back. In most cases it will be 90 days once it has gone through probate. Repaying back the loan with in 90 days either through selling the property or refinancing the property if you decide to retain the property.

Another item that you will want to consider will be the closing cost of the reverse mortgage. Closing costs are typically much higher than your traditional mortgages. In some cases it might be double to triple the normal cost. Again, that depends on the lender that you work with.

I have worked with a few people that where looking into the reverse mortgage program, that ultimately decided to finance using another program that is not a reverse mortgage. Ultimately it coomes down to cash control. You need to find a program that allowes the freedom of cash control to obtain your goals (traveling and enjoying the remaining years of your life). However, you do have a lot of home work to do in researching your options.

Contact me directly if you have any questions. Hope this helps…

Linda asks…

How do I go about getting a reverse mortgage?

And how do they work?

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

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Richard asks…

What is a ‘Reverse Mortgage’ and is it a good thing to do. Pros and cons please.?

I see it advertised on TV. Has anyone done it? Were you happy with your decision later? How will it affect my taxes?

admin answers:

I read some of the answers and cant believe the information coming out. Your best resource is to go to the AARP website and get the real facts. It is for anyone who is over 62 and you have to have equity in the home. If you currently have a mortgage then it either has to be paid off prior or the Reverse Mortgage will pay it off. You have choices of how to receive the available money, fixed monthly amount, fixed lump sum payment, or an open check book to the amount allowed. The older you are the more you can use. It is FHA insured and you still keep the ownership of your house. The only time the mortgage needs to be paid is if you move out of your house for a period longer than one year. It is for the seniors who need additional income, or that grandparent who wants to help a child or grandchild buy a home, go to school to name a very few reasons why they are beneficial. What about someone who is leaving their home to a charity, why not do a reverse mortgage and see the fruit of the donation while you are still a live. Why not do a HELOC? Because if you use the money under a HELOC then you will have a mortgage payment. If you do a reverse mortgage and use the money you do not have to pay it back unless you move out of the house. If you are in California email me and I will send you the brochures. The only thing negative about a Reverse Mortgage is the initial cost that is rolled into the loan. Depends where you live but you will not be able to have access to the total value of your home. Gfscfp@dslextreme.com

John asks…

I have a reverse mortgage and was wondering if I can use home improvements on my 2007 income taxes.?

If I can deduct my improvements, what deductions can I use?

admin answers:

No, home improvements are not tax deductible. You add them to your cost basis. That will reduce your gain when you sell and any capital gains taxes due at sale time, if any are due at all.

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Your Questions About Reverse Mortgage

Susan asks…

Has anyone here actually gotten a “Reverse Mortgage” on their home? How did you like it?

Any downfalls? Would yo do it again if you knew then what you know now? A friend of mine is turning 62 soon and is considering this option.

admin answers:

My first suggestion is not to listen to the answers already given as they are WRONG…….With a Home Equity Reverse Mortgage (HECM) which accounts for 90% of Reverse Mortgages and Regulated by the Federal Govt. (HUD) it is Ferderal Law that you must always remain on title. You will always be the owner of the home ….the bank never ownes the home. I suggest you go to AARP.org, HUD.gov, ReverseMortgage.org. Part of the safeguards the Govt. Has built in to Reverse Mortgages is third party counseling which is at no cost to you. AARP has counselors along with Money Management International to name a few. They are fully versed in reverse Mortgages and will give you an independent view an whether one is right for your particular situation. You can look at these resources and gather a wealth of information and if it is right for you then proceed to a Reverse Mortgage Consultant. I don’t know where you are but EverBank is a leader in the field and also my employer. Fell free to contact me with any other questions.
Thanks
Stephen

Sharon asks…

I have heard so many answers on a Reverse Mortgage. What is the real scope?

I am 62, own my home. Just want to be confortable and not worry about money. Have my mortage paid off.

admin answers:

Do yourself a favor and look at www.HUD.gov for your answers as in these open forums you usually get many people who think they are an expert on everything….and quite frankly aren’t. A Home Equity Conversion Mortgage (HECM) is Federally regulated and insured and counts for over 90% of Reverse Mortgages done today. Put Reverse Mortgage in the search box once you get to the HUD website and you’ll get all the info you need, right from the source.

Jenny asks…

Is the reverse mortgage scheme availabe ONLY for senior citizens?

I mean, can my dad, who is of 52 years of age, avail the benefit of this scheme?

admin answers:

The homeowner must be at least 62 years old to obtain a reverse mortgage and it must be on their primary residence.

Mark asks…

I live with my grandfather,he did a reverse mortgage and then later filed for bankruptcy when he passes do i..?

would i still get the house that were living in when he passes away? even though he as the reverse mortgage and bankruptcy over him or what?

admin answers:

Several issues here.

Whether you “get the house” depends if he has willed it to you, and when it goes to probate, if anyone challenges it. The Court will decide if you get it according to his Will, or if someone else is entitled to it or a part of it regardless of what the Will says; but at least having a Will helps the Court make the decision knowing what your grandfather’s intentions were. Depending on your state laws, the estate typically first goes to spouses and children, parents and then siblings. Doesn’t matter who lives in the house.

As far as the reverse mortgage goes, the bank is only owed what he withdrew, plus the interest/charges accrued over the time he had the loan. If the house is worth more than the loan balance, and you were willed the house, then you will inherit the difference once the loan is paid off. The loan can be paid off by either selling it or refinancing it in your own name (if you qualify for a loan). You typically have 6 months to do either, with the possibility of getting two 3-month extensions for a total of one year; but you need to be communicating with the bank. The loan is not assumable. The good thing about reverse mortgages is that if the loan is more than what the home is worth, the bank cannot go after the heirs or any other assets. It is a non-recourse loan and you are not personally liable.

However, if he filed for bankruptcy after he took out the reverse mortgage, that tells us that he must have a lot of other debt and those creditors may go after any net proceeds once the home is sold and the reverse mortgage is paid off (the bank gets paid first unless there are federal liens); or after you, if you inherit the house, and any other assets he may have. Depends on what type of bankruptcy he filed.

Mandy asks…

What is a reverse mortgage and where can I get one in Connecticut?

admin answers:

A reverse mortgage (known as equity withdrawal in the United Kingdom) is a type of loan available to older people, used as a way of converting their home equity (the value of the home, minus the amount of mortgages) into cash payments while retaining ownership of the property. To qualify for a reverse mortgage in the United States, the borrower must be at least 62 and be able to pay off an existing mortgage with the proceeds from the reverse mortgage and if needed, additional personal funds. The amount any individual homeowner is eligible for depends on their age, the Federal Housing Administration (FHA) appraised value of the home and the starting rate effective upon closing. The location of the home may also have an impact.

Reverse mortgages allow the home owner to continue living in the home, and allows repayment of the loan to be deferred until the borrower is no longer living in the home. In the United States, the proceeds of the loan are tax-free, there are no minimum income requirements, and for most reverse mortgages, the money can be used for any purpose.

Income and credit ratings are not considered by lenders when granting reverse mortgages, notwithstanding a bankruptcy that has not been resolved. The majority of reverse mortgages are FHA insured.

In a reverse mortgage in the U.S., a borrower can be paid in a lump sum, in monthly advances (payments), through a growing line of credit, or a combination of all three. The loan advances are not taxable and do not affect Social Security or Medicare benefits, although Medicaid and SSI benefits may be impacted. The cost of a reverse mortgage exceeds the costs of other types of loans. However, in some cases the costs may be less than or the same as the cost of selling a home and moving.

See a lender/mortgage company. Be careful! This type of mortgage is NOT for everyone.

Http://en.wikipedia.org/wiki/Reverse_mortgage

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