Your Questions About Reverse Mortgage Lenders

James asks…

Do you have to have permission from lender to add a name to a deed creating a joint tenancy? (Floroida)?

My friend was talked into adding her boyfriend to her deed and creating a joint tenancy. He makes no payments and has no equity in the property. There is a mortgage on the property and permission was not obtained from the lender before this was done. What can she do to get this reversed or is it even a legal deed in the first place since the lender is unaware of it and did not grant permission to do it.

admin answers:

He owns half the house now, including half the equity. She gave it to him. The deed is legal, what the lender will do is call the mortgage due, she is going to have to refinance.

Joseph asks…

Where does my grandmother’s house stand in the foreclosure process? How long until eviction?

Hello. I live with my grandmother in a house that had a reverse mortgage done to it a few years back. It was done under my grandfather who passed away in 2008. Usually when the borrower (my grandfather) dies the loan has to be repaid in full, but nothing has ever been repaid except property taxes. To date, me and my grandmother have been living here without hearing a word from the company or lender. This changed in mid-December 2010 when foreclosure papers arrived.

My county’s (Miami-dade, Fl) official website lets you track down docket information for cases online. I have a snapshot of the case dockets (aka a summary of the case) which you can see by clicking the link below. I just wanted someone to more-or-less translate the status of the house by looking at this information. Exactly where does this house stand in the foreclosure procedure and ‘how long would you say we are going to be officially ordered to leave from today?’ I think it was about one and a half to two months ago that a letter arrived saying they were trying to find someone to represent the interests of the house because the foreclosure papers came for “unknown heirs and tenants.”. Here is the snapshot of the dockets:

http://oi53.tinypic.com/2epkgh5.jpg

admin answers:

Stephen, have you spoken to other foreclosure specialists who just deal with foreclosures????????????? You and your grandmother need to hang in there. Knowledge is power. 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

Get a hold of some foreclosure professionals. Hope you find this helpful, particularly on how to utilize resources available to get your mortgage modified or at least fixed to avoid any potential foreclosure, 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 above that came into existence from my efforts, which is intended to be useful. Helping people get the relevant info they want is great.

Maria asks…

If you’re a lender, please help with advice?

I have a $510k loan and at least $900k equity. Tried to lower payments through a loan mod, was advised by co. to stop payments. Followed their advice & got into a worse situation. It’s w/BofA original payment $2600 is now $3900. All bank did was tack arrears to mortgage so it’s like I started over. Now bad credit 670 & 655 because we were behind. We don’t want to sell the home or move. Got turned down for a reverse mortgage, BofA will not allow another loan mod or refi. Any other savvy options or suggestions? Help!

admin answers:

Sorry to hear that. I’ve heard similar happen to many people; how a bank can advice someone to fall behind on their payments is incredible to me. Bank of America wasn’t the only one. And if you are able to make your payments, you don’t qualify for a loan mod anyway, or any of the government programs.

You may already know this, but just in case. The reason why you may have been turned down for a reverse mortgage wasn’t because you weren’t qualified (assuming you are over 62) but because FHA currently has a lending limit of $625,500. It doesn’t matter what your income is or your credit score is. Since there are currently no private jumbo loans available for reverse mortgages for high-value homes like yours, the only reverse mortgage program available is the FHA HECM. Unfortunately, because of the lending cap, any dollar over $625,500 that your home is appraised at is not given credit. How much you qualify for in a reverse mortgage depends upon the age of the youngest borrower (the older you are the more money you get), but only up to that cap. So while your home has a lot of equity, FHA only “values” it at $625,500.

That is why sometimes a younger spouse is removed from title when there is a large age gap between spouses. By using the age of the older spouse, they are eligible for more money. Not something recommended, but it is an option depending on your particular situation, if keeping the house is what you both want to do. Definitely something you want to discuss with a lawyer to protect the younger spouse’s interest.

But you can still do a reverse mortgage, if you bring money to the table at closing. I don’t know how much money you are short. Hopefully you were looking at the fixed rate product, which offers more money than the adjustable program, and can be found for as low as 4%. Some folks have other resources that they can sell or can access to bring money to the table, e.g. Sell investment property, a car, stocks, life insurance, gifts from family or friends, etc. I don’t know if this applies to you or if you are aware of it. The lender will want to document your source of funds to make sure it qualifies. Once you do the reverse mortgage, then that monthly $3900 stays in your pocket and no one can kick you out for non-payment of your mortgage. You will still have to pay your homeowner’s insurance and property taxes. Just mentioning it in case you weren’t aware. Good luck!

Daniel asks…

Will you write me in as POTUS if I promised to somehow stop this Wall Street bail out?

I would let the chips fall where they may and not reward bad investment, bad management and poor judgment on the part of mortgage holders and lenders at the expense of the American taxpayer and their children and grandchildren. Also curb and reverse the tide of illegal immigration by making it a felony and putting violators to work building the border fence that will eventually keep them out when they are returned to their home country. Use any form of energy at our disposal including but not limited to, wind, solar, tidal, hydroelectcric, methane, hydrogen, domestic oil, natural gas, coal and nuclear. I would work as quickly as possible to get our troops out of harms way in Iraq & Afghanistan by quickly bringing both nation’s armed forces up to strength for the task of defending themselves. Back to the financial meltdown for just a minute. 75% of people calling the Capitol Hill switchboard have asked Congress not to bail out anybody. This country doesn’t need Wall Street to survive. Wall Street has made it clear over the last two years that they need us more than we need them. Yes, we probably would have to endure a two to three year hardcore recession, but that would be nothing compared to the ten to twenty year depression that will ensue thanks to this goliath government bail out of $700,000,000,000 that is not even including the over $300,000,000,000 that has already been spent to bail out Freddie, Fannie, Bear-Stearns, and other failed small institutions over the last year. I also promise to not attempt in any way to change the law as it stands right now concerning any of your civil rights and would only select Supreme Court Justices that were true moderates. They would have to go through the most intensive vetting process ever seen to even be considered to a long list. I would do everthing in my power to get all political parties to start working together in a bipartisan manner for the sake of this nation or would actively support third parties that showed they would do so. So how about that write in on the first Tuesday in November, no chance huh?

admin answers:

Sorry.

Try running on for Mayor of Chicago on the Mrs. O’Leary ticket.

“Sorry, I’m not spending all that overtime to put the fire out. Mrs. O’leary left the lantern in the barn, she ought to do it.”

Helen asks…

Verge of foreclosure… need help on reversing this.?

In March 2005 we moved into our home. At that time we were w/ our starting finance company — which was great. Then the loan was sold (the 1st part of our mortgage) to CountryWide. In April 2005 my husband was diagnosed with epilepsy and thus lost his job because of it. Had enough savings to get through a few months of mortgage payments and in Sept the savings ran out which was going to be used for taxes but this money was not due until June, unfortunately due to the circumstances we were forced to use this for Mortgage payments. Attempted to make payments for the last 9 months but they refuse them stating all of what is due or nothing and let it build up. We rec’d a foreclosure notice in the mail in Jan. 2006. The Foreclosure finalization is 8/30/06. I have put in complaints with the FTC and the state Consumer Credit Agencies hoping to get answers to this predatory Lender. Any other ideas? Are there any real estate lawyers out there that can help? We need to reverse this asap!
Please only respond if you are :

A current broker, lawyer, or experienced in this field.

Thank-you.
Also an interesting site:
http://www.countrywidehomeloansucks.com/new_page_2.htm
OH and we are NOT selling, moving, renting or otherwise . We have an attorney now that will be running a counter suit through predatory lending laws, and conspiracy. There are a lot more details.

If there are lawyers that wish to respond to this and your speciality is Real Estate Law contact us!!! We are in Ilinois.
We are not going to move… we are not willing to sell our home.

admin answers:

Contact ACORN immediately. They are a non-profit organization that includes in it’s mission to help, act as a homeowner advocate to ensure lenders act fairly and legally when it comes to this whole process.

Here is the link to their offices by state. Call the one as close to your city/county as possible: http://acorn.org/index.php?id=2593

Here is the link to ACORN’s home page: http://acorn.org/index.php?id=2716

Prepare and organize all of your notes, receipts, call logs, correspondence and make time to meet with them as soon as possible.

Also, contact non-profit entities, starting with your local United Way, and your local HUD office. They have contingency plans to help families facing foreclosure. Sometimes there are funds available to help buy you time to prepare to…List your home for sale….and with a well-known and national firm. If you are fortunate enough to find the assistance, you can always cancel the listing.

Be realistic. Make a list of all of your expenditures and take that and your receipts to the nearest HUD-approved credit couseling agency. Find ways to stretch your income. For example, there are non-profits out there that oversee shared housing/roomate programs for many cities/municipalities across the U.S. They do the background checks and match up host families and tenants. If you have children and a daycare expenxe, perhaps you can do a trade with a college student looking for a chance to tutor and sit in exchange for housing. Maybe even a nursing student.

But be realistic and start the sales process for your home. You can always take the proceeds and get something more within your revised budget. You don’t want a foreclosure on your credit. This will make it nearly impossible for you to purchase a home/apt/condo anytime soon. Worse case scenario, you wait too late to list and take less than owed, and the lender then either looks to recoop the difference directly from you or writes it off and gives you an earned income statement for the difference that you then have to claim as earned income on your taxes for this year.

Please think long and hard and crunch the real numbers (start today making a list of where EVERY dollar goes, regardless) if you are even remotely considering refinancing as a solution. From what you wrote, refinancing will only set you up for a harder fall and cost you even more money…especially upfront…and this is money you need to prepare to relocate.

Call ACORN, the HUD-approved credit counseling agency and your local United Way; and they can better analyze your situation explain all your options to you and direct you on a best-case scenario path. My heart goes out to you but the time is now to act. Delaying makes things worse and wittles away your options.

God Bless you and your family.

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Your Questions About Reverse Mortgage Lenders

Sandy asks…

Can a negative mortgage escrow be reported as past due on my credit report?

I found out after pulling my credit report that my mortgage lender was reporting me as $6,400 past due on December 31st when one of their agents told me on December 29th that all that was needed to bring my account current was $858. When I inquired last week about the reporting to the credit bureaus, I was told to send a letter to the research department. It was also suggested that I request a loan modification. Within a day after they sent the paperwork for the modification, changes had been made to my account history reversing payments made in December and not displaying payments made in January, and showing a negative escrow in the amount of $6,400. Needless to say, I haven’t submitted the modification paperwork. This reporting has caused my credit score to plummet. What recourse do I have?

admin answers:

You have a number of ways to combat this, but you may need some outside help.

I would dispute the item with the credit bureaus first, as you will need to do this before disputing the item with your mortgage company. Dispute the amount reported, the fact that it shows a late payment, and anything else that you believe may be incorrectly reported. Send your dispute via Certified Mail with a Delivery Receipt (online version is fine).

If this doesn’t solve the problem, send a complaint directly to the mortgage company, also via Certified Mail with a Delivery Receipt.

If you have paid your account on time and the only adverse element of the account is a deficiency in the escrow account, then you should not have any adverse reporting on your trade line. The lender is responsible for properly maintaining the escrow account, and if they made an error in calculating your payment, then they will need to notify you of any adjustment to your monthly payment prior to your next adjustment date.

As for the loan modification, you may contact a company that performs this function, or you may handle it yourself. I would recommend that you check the government’s “Making Home Affordable Program” first (see link below). You can do this yourself, and you may be surprised at how easy this can be handled.

Just be sure to gather all of the required documents and complete the paperwork carefully, for best results. Contrary to popular belief, you do not have to be late on your payments in order to qualify for a modification.

Good luck!

Mandy asks…

High speed rail. Part of a plot to Crash the US economy like most Progressive spending programs historically?

Can You Handle The Truth? Read it or shaddup. Don’t ask me for links, you can find this stuff & if you don’t care enough to look then don’t bother to read. This is not for ignorants or morons.

Our Government has been screwing us for nearly 100 years. Progressives are not all Democrats. Republicans have had a hand in this, though not the guiding hand.

Here’s the Truth behind the mystery caused by Progressive Smoke Screens. The Progressive Movement was created by Fabian Society members who wanted the US back under European Control. The time bombs put into our economy have been done by Progressives like Wilson & FDR. They seem like prosperity, but what they are is addictive debt that anyone with a brain had to know couldn’t be sustained.

Now politicians who take them on are destroyed because the people are addicted to them. It’s a slower acting destruction of our culture much like the free stuff black populations were given was a faster acting destruction of their culture. Leaving an entitlement culture that depends on Uncle Sam and is basically his slave.

Keynesian Economics itself was devised in Harvard University with a goal of stealing the wealth of the people & taking it for the government. That’s what the cycle of inflation & deficit was determined to do, and Keynesian Economics was the harness to take advantage of that false state of prosperity.

That so called prosperity was like the reverse mortgage loans they give old people where the lender takes possession of the home when they die. Their hard work is taken by the rich lenders, many of those held by Fabian Society Members. We’ve sold out the whole country & it seemed like it was great, we were wealthy, but we’ve screwed the generations to come. Pretty much now they are us, and we’re screwed.

The truth about these things is clear now to any who dare see. Yet Obama keeps working it trying to crash our economy quicker & more completely so there will be no hope that we can come back.

Do you want to chop down the apple tree to get the apples faster? There will be none next year. That’s what the democrats are doing. You will have nothing, you will be serfs to the uber wealthy who will complete an Oligarchy of not only the US, but the entire world. That’s the Fabian Goal, that’s what the Progressives are working toward though their idiot sheep are clueless of that.
Tea Party Hating Nazi … Japan uses it only in high population areas and I do believe that it’s privately controlled.

China has slave labor, everything is cost effective there because they have slaves. Is that what you want? Everyone to be a slave so that kind of thing is cost effective because you don’t have to pay anyone?

Big ol Duhh moment dude.
Growth vs Oil … That’s Keynesian Crap that’s proven not to work, in fact if you read the notes after my question I’ve told you that it was designed to bring the system down.

JFK depended on Austrian Economic Theory. He rejected Keynesianism.

Check out Austrian Economic theory, which has a much better record & a much better group of facts behind it.

Keynesian theory is what Communism is to Governmental Theory, it’s a disaster & it’s never been used by anyone for anything but to bring down an economy.
romare … Plenty of articles on Fox News about high speed rails and how it would be a worse debacle than Amtrack.

High Speed rails should be funded by those who ride it. If it’s good that will work, if not then it shouldn’t be paid for by tax payers.

admin answers:

Excellent

Do you want to chop down the apple tree to get the apples faster? There will be none next year.

A principal that should be taught to every child in the world.

Keynesian Economics was in deed designed by Progressives with connections to European Fabians to bring down the US system, or at least the US population into serfdom as Europe has set up to a degree with the class system & groups controlling all the wealth & the others being the live stock that generates their ongoing wealth.

Jenny asks…

short sale vs foreclosure for a loved one?

Need some advise on my mom’s home. She hired a firm to do a modification for her home loan payment back in Sept of 2010. Modification went to the lender for review, still waiting to hear back. Was served with papers for complaint and summons from the bank. She has dementia and is not mentally stable to stand in court to represent herself fully or answer questions appropriately so question is, being I am her POA, should I just consider going for a short sale and be done with her home and avoid foreclosure or proceed with the nerve wracking answer and motion deal to set the foreclosure intention back some in hopes the modification will be decided in her favor by then? It’s very nerve wracking. Also, if she has her name on another property but her son is mentally disabled and has a reverse mortgage out with a different lender on that home, (I am his guardian), can the bank take this property as well if her original home goes into foreclosure? I was told being her son is mentally disabled, they can not take a home away from him or me for being his care taker but not sure just how true this is. This is in the wonderful corrupt state of New Jersey by the way. Any advise or suggestions would be greatly appreciated. This is such a stressful situation to deal with. Please help!! Thanks so much for your time….

admin answers:

Depending on your state, while in the process of a loan modification the banks are supposed to consider your account in review and not proceed with foreclosure procedures. If you are not happy with your loan modification company may I suggest you at least do a search for forensic audit specialists, as this might be another solution to saving the property if the loan modification company is not successful.

If you have a short sale specialist and they have been successful with negotiating with the bank, and you are not looking to save the property, this is a very good alternative as well. However, banks are not required to approve short sales just like they are not required to approve loan modifications. Make sure there is no charge upfront to perform the short sale.

William asks…

It’s a fiduciary duty for trustee to only do what benefits the estate?

How can I explain to my brother that it’s to both are benefits that we sell dads house that has a reverse mortgage .Just because dads living trust says he could live in the house for 3 years But now with a reverse mortgage.As trustee his duty is to only do what benefits the heirs not himself .Not informing lenders of death and still cashing there checks is fraud .He is using our own money just to live there. We need to sell as fast as we can before it forcloses to salvage anything left.Somebody explain it to him
my father died 3/7/2009 in california
no estate atty

admin answers:

I am not clear what is going on. Is your father deceased?
Where is the estate atty in this squabble?
You both need to go to a trust and will attorney and have him advise you, it will be worth the200 bucks or so he will charge to look at the dollars and documents and advise you what you should do.

If somebody is cashing checks made out to a deceased person without court authority, somebody could end up in prison

Robert asks…

Can I refinance with high risk credit and less than 30k a year?

My grandmother left me her house, but it had a reverse mortgage so I would have to refinance in order to keep it. The house has a 50k balance on it. I have high risk credit and I am a nurses aide who makes less than 30k a year. I paid off a few thousand dollars of debt over the past year but I don’t know if that helps. Anyway, my question is with my stats would it be worth my time trying to refinance or should I just sell the house? I know banks are tough but would private lenders be willing to refinance me?

admin answers:

You earn enough money, so all that really matters is if the house appraises high enough and if your credit is good enough. You can have really bad credit, like 650, and still get a loan. It might be an expensive loan, but a loan never the less.

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Your Questions About Reverse Mortgage Lenders

Daniel asks…

heirs and reverse morgtage upon death of home owner?

Is there any law when the heirs of a home with a reverse mortgage loan don’t let the lenders know borrower died and continue to receive the monthy payments and live in the house.what is the punishment

admin answers:

That would be rather stupid. Why wouldn’t they just sell the home, and then get a lump sum for the equity?

A reverse mortage is just a loan against the equity, so they are just borrowing against their own money, and then paying interest on it. Reverse mortages have fixed terms as well, even if the person who took out the loan when ther term expires, then have to pay the mortage back in one lump sum, usually by selling the home.

Joseph asks…

capital gaines taxes and no money will be made from the sale of our fathers home?

no profit will be made from the sale of our fathers home 1ST mortgage and 2ND ( some kind for reverse mortgage ) has to be repaid to lenders , Brother says we have to pay capital gains taxes . I know he is full of it ! He also says we don’t have to repay the 300.00 2ND ( reverse mortgage ? that paid my father 5,000 each month for 3 years ) and for 6 months that my brother cashed anyway after Dad died

admin answers:

Whoever is the executor of your father’s estate should be using an estate attorney to advise him/her on these matters. You won’t get informed advice here. However, any taxes due on the estate’s assets are paid for by the estate prior to final settlement. Heirs are not taxed directly.

Susan asks…

A lot of people think, to take some of the spotlight off of Barack Obama?

A lot of people think, to take some of the spotlight off of Barack Obama, that John McCain will announce his vice presidential choice this week. And most think it’s gonna be Mitt Romney. See, I don’t know. You know, when Romney and McCain stand together, doesn’t it look like one of those slick Countrywide lenders trying to trick your grandfather into reverse mortgage
what do you think?

admin answers:

I think most Americans are going to reject McCain/Mitt and their lobbyists friends.

Richard asks…

How do reverse mortgages work, in simple terms?

I must be stupid or something, but I’ve been reading about reverse mortgages and I just can’t seem to understand the concept.

My boyfriend’s dad just decided to do it. He has some mental illnesses and tends to get taken advantage of, particularly in regards to money. Unfortunately his wife passed away last year. Essentially, what is a reverse mortgage and what does that mean for my boyfriend (in simple terms, please)? Why are you given money? What’s in it for the lender? Will the house still go to my boyfriend if his father passes away? Does this cause you to go further into debt?

I believe he bought the house 25 years ago for $80,000. I estimate it’s worth $120,000 now. Pretending he still owes $30,000 for it… what does that situation look like?

admin answers:

My peers are partly correct.

A Reverse mortgage is exactly what it sounds like; instead of the
borrower making monthly payments to the lender after getting
a lump sum payment……the lender lends the borrower a fixed monthly payment. NO payment is due to the lender till the
end of the mortgage when either…….
The borrower has died and the estate does not want the house
so the lender forecloses.

Or……….the insurance if there is any, pays back the
lender and the house is debt free to the estate.

Or, if the borrower lives long enough, at the end of the
mortgage life [loan], he needs to re-finance
the home so that the lender is paid back.

Mandy asks…

How often does Soc. Sec. reverse a “favorable” decision?

We receive disability.

My mortgage lender goes “Oh my, your case is reviewed in a mere two yrs instead of three yrs!!”

“OH MY!” indeed!!!

Am I correct to fear that they may reverse my case? Wouldn’t logic conclude that a reversal of the original decision (by a judge) was “wrong” and that I would be responsible to pay back money from like fraud or something?

It’s not fraud.

I’ve owed (and went bankrupt) over $20,000 medical bills. I’ve been institutionalized at 2 times for over a month each, and once for a week (on a few different hospital stays.).

I’m trying to buy a house. should I use my $19,000 settlement for a $19,000 problem fixer upper house, or should I resort to making payments -like most grown up adults tend to do- for the rest of my LIFE?! Put down payment on a $60,000 house? I fear losing my source of income (disability)!!!!!!!! I could have a no payments need problem house. (is it a “problem”? I don’t know. I’ll need the structure guy, the pest control official, and the septic Environmental healthy guy to deem the place “livable” … ) anyway, believe it or not, the cost would be the same :

$44,000 (if you add the potential problems: new roof expense 12,000 $ in 2 yrs, in 3 yrs maybe new septic at $10,000) or should I buy a
“perfect” $60,000 house With a new roof already on it? I put down my $10,000 or $19,000 and get $6000 back from the Gov Obama house stimulus (yes I qualify. I had to make a lot of phone calls, as I do not even FILE taxes, but Yes, I CAN file a “tax amendment” to receive back the gove. $6000 on my $60,000 house)

do I need to fear losing my disability claim?????

I’m Manic Depressive Bi Polar…. documented. It will never go away… but… I have sporadic periods of work history and NOT so good work history! I’ve even worked (what some people call “high stress”) high responsibility bank teller jobs. I was the “assistant job set up person” in a factory (by default. None of the older gentleman wanted to learn the computer.I’m young. I’d love to learn the cpu.).

what are your thoughts on this?

(I’m not going to fix the roof myself, I’d hire someone.) but you know what, that $60,000 new roof house will not be so “new” in 30 yrs. I’ll have to replace it in 30 yrs!!!!!!!! Good Grief!!!!!!! Does this ever end?
I plan to pay $19,000 cash for the house, and save $800 per month towards the roof. In 1-2 yrs we could pay someone to fix it. Same for the septic, in the next 4 yrs we will fix that one. There are too many people living in the house, taht is the problem. A small woman and small baby will use less septic than three adults and a child currently there.

admin answers:

The problem you will run into is that if you buy a fixer upper, you take the risk of not being to qualify for a $12,000 loan for a new roof since you will also owe $44,000 for the loan of the house. It will be hard to qualify on disability for two large loans. You should go for a home that is as problem free as you can find it. Most people put down 20% when purchasing a new home. You also will have the occasional repair such as heating/air expenses and even replacing the units which costs around $3000. Then there is the hot water tank about every 10 to 15 years. Also appliances break down and need repairing. Then there is the plumbing when it goes on the blitz, and you will have the added repair of the septic tank.

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Your Questions About Reverse Mortgage Lenders

Donald asks…

Reverse mortgage and estate law?

My mother is looking into a reverse mortgage what concerns me is what happens to her estate when she passes will the lender have a lein on the house how can this effect willed property?

admin answers:

The reverse mortgages I have seen are non recourse loans- meaning that in a foreclosure situation the lender could take the house but not come back against your Mother’s estate for any shortage.

What seems to often happen is the parent borrows as much as they can on a reverse mortgage and is able to live in the house the rest of their life without making payments. They do have to pay insurance and property taxes.

When the die or move out to a retirement home then the mortgage has to be paid off. If no one pays the mortgage off then the loan company is allowed to foreclose on it and sell it for whatever they can get.

During the time your mother lives there without making payments the interest is building into the principal each month and the loan is getting bigger and bigger. So when she no longer lives in the house the loan will probably be so large that you will not be able to sell it for enough to pay off the loan. But any other inheritance would not be affected.

Lisa asks…

trustee wont sell home with reverse mortgage?

Dad passed away 3/7/2009 My brother the trustee will not let us sell the home . He is also cashing Dads equity funds that the lender are still sending. I do not want to take him to court. Till I have some inherantance . Then I will for all the money he took when Dad was alive. Brother had POA with access to all dads bank accounts

admin answers:

Call the lender’s servicing department and tell them your father died, give them your brother’s name and address. If he’s cashing the annuity checks, he’s committing fraud. If you know about it and don’t rat him out, you could be considered an accomplice. And you’re getting screwed because the interest on the reverse mortgage is mounting every day, and fees are being incurred. Your brother is messing with your inheritance.

He has to do something because once the person with the reverse dies, the loan is due.

In fact, all mortgages work that way. When the guy with the mortgage is no longer around, the estate must pay off the mortgage somehow. This applies even when there are other owners who were not borrowers. They have the same options in any case, using whatever money is available, selling the house and paying the mortgage with the proceeds (additional proceeds would go to the heirs) or if someone wants to keep the house and has adequate income and credit they may be able to refinance it into their own mortgage.

Once the bank knows the mortgagor is deceased, they will give you some time to make whatever arrangments, but if nothing is done after a reasonable amount of time, they will start foreclosure. In other words, you may think you can trick us if you don’t tell anyone what’s happened, but we will find out eventually and you may regret not being honest. “You” in the generic sense, not specifically you the person asking this question. My concern for you is that you know what’s happened and could find yourself in some hot water too.

If the lender is BofA, call 866-863-5224. They’re in Seattle, open from 7am to 8pm Pacific time. You’d probably call that number for Countrywide too.

Carol asks…

Does anyone understand Reverse Mortgage?

I have only one daughter. I have an offer for $56,500 from a lender. I owe just the same amount. I refinanced twice, so no equity left in the house. The letter says I won’t have to pay this back as long as I live in the house. What will happen when I die?

admin answers:

The money is repaid from your estate when you pass. Depending on the contract it could just be the house is forfeited an no other monies owed. I am surprised you received a reverse mortgage having refinanced, but it is done now.

Make sure the bank will let you sell for the amount owed. I doubt they will, it should be stated on the reverse mortgage.

Steven asks…

Paying off reverse mortgage?

My father took out a reverse mortgage several years before he died, my mother lives in the home. With the real estate market as it is now, the value of the home is probably not much more than the balance on the reverse mortgage.
My brother and I have cared for my mother for 6 years so far, and when she leaves the home, we do not want to have to come up with any additional funds if the place sells short.
Can we just sign it over to the lender so we don’t have to deal with the whole thing?
We are not concerned with financial gain from any inheritance, but neither of us are in a position to pay off this mortgage, or make up the difference.

admin answers:

The only way I would recommend prepaying a reverse mortgage is if your mom is very low income and is going to move into a subsidized senior apartment complex. In that case, it might be a good idea. Otherwise, I wouldn’t recommend it. For one thing, where will your mother live if you sign it over? Are you or your brother prepared to take her in or pay for an apartment?

For most reverse mortgages, the heaviest expense was upfront in the financing fees. You won’t get that back if you pay it off soon. If she passes away and the house value barely covers the reverse mortgage, then any assets she has in her estate can be used to pay it off, and if those aren’t enough, then that is the bank’s problem and the risk they took in giving your father the loan. You won’t be responsible for the shortfall.

It’s nice that you are helping your mother. But, her debts are not your responsibility to cover when she dies. It will come from her estate.

There are some specialists in elder law and reverse attorneys you may want to talk with for the specifics. Try this website for a referral www.benefitscheckup.org. Or, you may also want to contact the AARP and ask them for a legal aid referral.

Good luck.

William asks…

Is it really the fault of the lenders?

“Redlining”, in which mortgage lenders would refuse to grant home loans to low-income areas used to be common practice in the industry, because it avoided risk. With the Community Reinvestment Act (CRA), which was passed in 1977and revised under the Clinton and Bush administrations, reversed this trend. Lending institutions were coerced by the government to begin a practice known as “Reverse Redlining”, in which people who cannot afford houses are given loans for those houses anyway. Before we start blaming the lenders, why don’t we repeal the CRA?

admin answers:

That’s true. The government shouldn’t have encouraged such risky loans. The country would be better off today. Mainly, I guess it doesn’t matter at this point who is to blame. The problem needs to be addressed and quickly.

Even with all of the money that the government is going to throw on top of this fire, we have yet to see if it will be a fix or just a band-aid. I think the problem is far too complex to guess at the outcome. We will just have to wait and see what happens next.

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Your Questions About Reverse Mortgage Lenders

Robert asks…

IndyMac owns Financial Freedom. Is it still safe to get a reverse mortgage with Financial Freedom?

We are in the process of signing papers with Financial Freedom but I worry about them since the government seized their parent company IndyMac Bank. They say they can still make loans, but I worry if they will be able to continue the monthly payments. If I went with them, could I transfer to another lender at a later time?

admin answers:

As long as you are going with the HECM product you have nothing to worry about. The beauty of the HECM reverse mortgage is that it is government insured. This means that if something were to ever happen to Financial Freedom the government transfers the loan and not only guarantees your payments but they also guarantee that you will get them on time. The government did a good job covering all possibilities with this one

Carol asks…

can my step father put me on the reverse mortgage even tho im not his blood son?

Im told he had to add my step sister, but this just doesnt seem right. Apparently the lender required him to add her and not me because I am just his step son.

admin answers:

I don’t understand this question at all, you should ask it on a subject about mortgages or banks.

Paul asks…

Reverse mortgage HELP PLEASE?

Hey everyone i have a question about reverse mortgage. I will be turning 62 In march and i have been looking into refinancing into a reverse mortgage.. but as many houses out here in California my house has lost value and I Do not have any equity… Can i qualify for one? and does anyone know of a Reliable FHA-approved lenders In So-Cal?

admin answers:

Good day,

I am Richard a private loan lender, i give certified loans to serious minded individuals and company at an interest rate of 5% with total loan repayment allowed weekly monthly or yearly depending on how you can make repayments if interested email me at rj.microfinance@mail.mn .We only offer out in: Dollars,Pounds,Euro and Naira only.Apply with the following details:Name,Address,Cell number,Occupation,Monthly income,Loan amount needed&Duration.

Email: rj.microfinance@mail.mn

Richard asks…

Reverse mortgage, Are rates and fees pretty standard, or should I really shop around?

Im 64 and my mortgage is paid off. I read from one lender that fees could run between $5,000 to $8,000. Is this a competive market or is this what I should expect?
Also, my wife ( co-owner ) is only 60 years old…. What problems will I have with eligibility? Should I just scrap this idea and is there another way to get my equity from my house. I am on social security retirement..with no other income and my wife is unable to work.

admin answers:

Hello –

This is a great question.

Until recently, seniors 62 years of age and older have not had the best choices when it came to getting cash from their homes. Traditional home loans only offered the option of either selling one’s house or borrowing against its equity.

With reverse mortgages coming on the scene, seniors now have some additional cash-flow alternatives. This type of loan allows mature borrowers to convert their home equity into tax-free income without leaving their current home or making mortgage payments – and they do not need an existing income to qualify.

How a Reverse Mortgage Works
Reverse mortgages are probably best understood when
compared side-by-side with traditional home mortgages, otherwise known as “forward” mortgages. The following table shows the differences between the two:

FORWARD MORTGAGE REVERSE MORTGAGE

Uses income to pay debt Uses home equity to get cash or credit

Monthly mortgage payments No payments

Falling debt, rising equity Rising debt, falling equity

Both loans incur debt against your home, and both affect equity, but they do so in different ways. Traditional home mortgages require making monthly payments to a lender. With a Reverse Mortgage, payments are made to you.

What a Reverse Mortgage Involves

Here are some important points to know when considering a reverse mortgage:

Eligibility: To qualify for a reverse mortgage, you must be at least 62 years of age. All owners who are on the title deed must meet this age requirement. You must also have paid off all, or most, of your home mortgage. Lastly, the home you reside in must remain your principal place of residence.

Mandatory Counsel: In order to ensure that homeowners are fully aware of the financial ramifications of obtaining a reverse mortgage, you must undergo counseling with an unbiased third party before completing a loan. HUD and AARP oversee a network of counselors who can provide this service, and it should be offered for either a nominal fee or at no charge.

Tax-Free Income: One of the advantages of a reverse mortgage is that the money you receive will not be taxed. The amount you’ll obtain depends on several factors including the plan you select, the type of cash advances you choose, your age, and the value of your home. Typically, the older you are the larger the loan, as you will have more equity in the house.

Cost: The cost of a reverse mortgage varies considerably from one type to the next. However, you can typically use the money you receive to offset the loan fees. The costs will be added to the loan balance and must be repaid with interest once the loan terminates.

Repayment: Reverse mortgages do not require any payment as long as the borrower(s) remain in the home. Should the borrower(s) pass away, sell the home, or permanently relocate, then the loan would be due in full, along with interest and additional costs. If two borrowers are on the loan and one dies, the loan would not be due since one of them still occupies the home.

Home Equity Conversion Mortgage – The Federally Insured Loan

The most common type of reverse mortgage is the Home Equity Conversion Mortgage, otherwise known as a HECM mortgage. This is the only reverse mortgage program that’s federally insured and backed by the U. S. Department of Housing and Urban Development (HUD). This type of reverse mortgage is popular for a few reasons:

Ability to choose your own interest rate.
You can select one that changes annually or one that changes every month.

You have several payment options.
You may receive monthly loan advances for a fixed term or for as long as you live in the home. You may also choose to receive a line of credit or combine monthly loan advances with a line of credit.
The loan can be used for any purpose.
With a HECM, you don’t have to designate the loan to a specific use; you can apply the funds to anything you choose.

Protection.
This is one of the most attractive features of a HECM. This plan protects you by guaranteeing continued loan advances even if your lender defaults.

Sell or Stay?

The main reason people choose a reverse mortgage is to gain financial independence and maintain an adequate standard of living without leaving their current home. The best way to decide if a reverse mortgage is right for you is to compare it to the other option of selling your house. To do this, ask yourself these three questions:

How much cash can I get by selling my home?

How much will it cost to buy or rent a new place?

Is it worth my moving now, or do I prefer to do something else with the money?

Perhaps you’ll confirm what you knew all along, where you now live is the best place to be.

Darren Meade is affiliated with Victory Lenders, a Christian based company. If you would like to receive a FREE CD containing an interview with Sarah Lyons and John Lucas, the co-authors of Reverse Mortgages for Dummies, please contact Darren at 866-676-4325.

Susan asks…

2 wrong reverse mortgage appraisals: borrower manipulated?

My mom had 2 appraisals while she had her Rev Mort. One completely omitted an entire room, and one listed her flooring as vinyl/carpet instead of wood/tile. Why did the lender loan her money when the appraisals were so wrong? Why elderly mom probably didn’t even look at the small print in them.

How could the lender not know about the missing room? That’s information that anyone can get. Sounds like the lender was being manipulative, Agree?

admin answers:

I can’t help but ask, why were there two appraisals done? Did the first appraisal come in so high that the lender questioned it and required another one? Or did you complain about the low value and fought for a higher amount? It’s not typical.

The other person who answered may be right that the appraiser was lazy; it wouldn’t be the first time; but i prefer to give the benefit of the doubt. It could be that the extra room was built without a permit, and so it could not be officially counted. You didn’t say what kind of a room. As the other person said, a bedroom or bathroom would definitely affect the value; but if it was a small nook, he may have been too lazy to figure it into his drawing, or too in a hurry to go to his next appointment. Unfortunately, some folks try to accept all the jobs they can and then are not able to do them well; vinyl vs wood may or may not have made a difference; i’ve seen appraisers whiz through in 15 minutes and take photos hoping the photos will remind them later of what was in the house when they make their report – and then forget a room or other details.

If you used a broker, or the bank officer had taken the time to go to your mother’s home, they should have had it corrected before it was turned in to underwriting. They are as much at fault. But if she dealt with someone online, out-of-state, or the local bank that doesn’t do house calls, then she may have gotten what she paid for. Customer service is very important in reverse mortgages.

The lenders are many times out of state, and would not have necessarily known the details of your home; that is precisely why they must go by the appraisal, wherein a licensed professional physically looks at the home, and not by county records, which are often times wrong. They would not have known the appraisal was wrong unless someone questioned it, either based on the photos, or by the loan officer.

Reverse mortgages are very conservative, and lenders will usually not give more than around 70% of the loan value, so the lender has a lot of room for error. Not sure why you would call it manipulative. If anything, the lender gave your mother less money than she could have received, because they based it on a smaller and dated home. But as the other person said, even with vinyl and carpet, it is still a good investment. What is more important to the lender is that it is well maintained.

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Your Questions About Reverse Mortgage Lenders

Nancy asks…

Regarding Reverse Mortgage, what is the pros and cons of HECM lenders vs. non-HECM lenders?

I have done a lot of research regarding reverse mortgage and I understand that this is much like “Payday Advance”. The overall interest including all the fees, etc. are substantial however, it is an opportunity to have the money now. I’ve own my house for close to 35 years now all paid up. It’s a comfortable place situated in a comfortable neighborhood. I don’t want to leave it and go to Belize where I can live on my social security alone. It’s the comfort that I don’t want to lose. If and when I’m incapacitated then I’ll land up in an old age home of sorts. My children are fairly well off and the inheritance left from the house may just cause trouble among them. So by augmenting my income now from this mortgage, I hope to gain a bit more quality and comfort of life. I fully understand the position many contributors endorsed. The math stinks overall. But I wish to enjoy life now. When I croak either way I become the loser. But thanks for the inout.

admin answers:

Money Magazine had a report on reverse mortgages.
They considered them one of the worst financial mistakes a person can make in a lifetime.

They suggested to sell your home.
Take the cash equity and buy a much smaller home or rent.

Are you sure you really want a reverse mortgage.
They are big money makers for the brokers – they can be very pushy
Keep your head on straight with them.

At age 80 – are you really going to want to be taking care of a home?
Cutting the grass, making repairs, fixing faucets.
Get a condo – and let someone else do all the work.
/

Charles asks…

Reverse Annuity Mortgage?

What are the risk factors associated with Reverse Annuity Mortgages from lenders‘ and borrowers’ point of view? Explain how they would affect lenders and borrowers

admin answers:

Every reverse mortgage I have seen has been an FHA program for older people and they normally choose to get all the money in one chunk. They are set up so that the owner never has to make a payment as long as they live in the house- but if they go to a retirement home they will need to sell the house and (because of the interest build up and maybe the weak real estate market) the seller might owe more than the house is worth. Again this FHA program is pretty good because it is a non recourse loan so that all the lender can do is take the house – they can’t file against you personally.

Robert asks…

How does a lender benefit from reverse mortgage?

Looks like, what I read tells me, the lender pays the homeowner roughly up to 65% of the home’s value, or up to $625,000

What is the benefit for the lender to put up such cash? Do they collect the house when the borrower dies? Or at any point? What must a borrow “violate” or “do wrong” for the lender to “win” (in comparison to traditional mortgages, where a person stops making payments and the lender collects his house).

What does reverse mortgage mean to a person’s heirs? Can they inherit the house? Or can the lump sum be inherited (and if they do, does the house go to the lender?)?
So is a typical reverse mortgage something like this?

a) Old Joe has a house worth $200,000
b) reverse mortgage lender offers him $130,000
c) when he dies, his heirs either allow the lender to have the house or pay back the $130,000 which their father took.
d) I’m not sure where the “interest” comes in? What does the borrow have to pay? Does he start making payments back to the lender the first month he gets his lump sum of $130,000 ?

admin answers:

My peer is correct. YOU seem befuddled about reverse
mortgages. They are not much different from regular ones.
Money is lent, collateral is put up and the lender earns
interest.

IN this case, during the history of the loan, the borrower
gets money. EVERY month. AT the conclusion of the
history of the loan–when the mortgage payments are due
to cease, the home owner [whomever that is at the time]
re-finances the home or sells it to pay off the lender.

A reverse mortgage can be from near nothing [4%] of the valule of the home
to 100%, it is all negotiable.

Ruth asks…

Who are the lenders for a “Program 69 Mortgage”? What states is this “Loan Program 69” availiable in the US.?

Better than a reverse mortgage it is specifically for seniors over age 69.

admin answers:

Dear ,

I was also searching for same thing couple of days ago and found this one  
http://yourloans.noads.biz

Regards,

Jenny asks…

Why don’t people realize that a reverse mortgage is a scam?

Sadly, large companies with big PR departments get away with expensive ads on television about the greatness of reverse mortgages and what they can do for you. The truth is all it will do for you is give you dribbles of money on your own equity while a lender has your money and just pays taxes. If you have paid off your house you can simply sell it and get all that money in hand. Don’t be scammed!
For those who are wondering about my credentials. I’m a successful real estate investor and I am well read on the processes involved. I simply want people to be aware of this. I expect a mortgage lender to say that this is a good thing. You are the people who are the scam artists.

admin answers:

And I suppose your better idea would be for the old people of america to just quit claim their homes to you instead and expect you to take care of them.

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Your Questions About Reverse Mortgage Lenders

William asks…

Question about reverse mortgage……?

I’m trying to find out some helpful information for my parents. They are considering a reverse mortgage, but so far my Mom has only spoke with one lender……We live in SC, and the last time they had their house appraised it was for $91,500. or somewhere around that amount…..The lady she spoke to on the phone today told her that if her house is appraised at only 91500 she will only get around $60,000. and that is before the closing cost and other fees, which all that added up to be around $14,000. Does this sound right? We were thinking that she should be able to get more than that…..If anyone has any experience in this, any advice would be appreciated. I’ve found a list on the Gov. website for hud approved reverse mortgage lenders…..Maybe she should call around for the best deal? Thanks guys and I hope everyone had a blessed Christmas!

oh yea, and if it helps any, my parents don’t have a current mortgage. They owe nothing.

God bless……

admin answers:

This is actually pretty good, they usually go to about 60% of the value.

There will not be ANY of these that will pay your mother a fair market value. They make their profit on the back end, with the equity instead of interest.

If your parents have other options they should go with those, this one is not a good deal, no reverse mortgages are.

Michael asks…

I want to know where to get a list of reverse mortgage lender in Minneapolis area with address, name, phone et

admin answers:

Hello Frankie,

Here’s where you want to go…..www.reversemortgage.org . This is the website for the National Reverse Mortgage Lenders Association (NRMLA). You will see on the left side of the page a link to ” Locate a Lender” Click on that, then use the drop down arrow to get your state, and a list of lenders with names and phones will pop up. You will also find some good information there also. For disclosure purposes, I have been in the Reverse Mortgage business for over 2 years and I’m a Reverse Mortgage Consultant for EverBank Reverse Mortgage…a National Bank that only does Reverse Mortgages. If I may suggest you call Larissa Morrell, you will find her to be a fantastic source and will guide you thru the Reverse Mortgage process.

Regards,

Stephen Greenberg
Producer/Host
Senior Solutions Radio
AM 1060 WBIX

Donna asks…

ron a reverse mortgage can the lender sell the home to a family member for more than an outside non relative?

for a lesser amount after the owners die?

admin answers:

Yes, they can sell the property to anyone they want for whatever offer they decide is the best.

John asks…

How much does reverse mortgage counseling cost?

I was reading a site called www.reversemortgageabcs.com that talked extensively about the need for reverse mortgage counseling and even where I could find a counselor. However, it did not mention how much it would cost nor did it mention whether I would have to pay for it (or if the lender would) if I decide not to proceed with the reverse mortgage.

admin answers:

The borrower doesn’t pay for it at all. The lender pays. On most, if not all, reverse mortgages, the borrower doesn’t pay anything if the loan doesn’t close. Say your appraisal is too low. You don’t pay any fees.

Look at the AARP website. They have a lot of details there. Bank of America’s website is very good. They have a calculator to give you an idea how much you might be able to get.

Susan asks…

With a reverse mortgage if owner stays in house and ends up with excessive equity does lender go after estate?

With a reverse mortgage, If owner stays in house for longer than expected and with interest, etc. ends up “upside down” — in other words, more is owed on the house than it’s current value, (of course, after the death of the owner), and after the bank sells the house can it then come to the estate to make up the difference?

admin answers:

Reverse mortgages are tricky and prone to lots of misinformation. But do not worry in this case. First, the bank doesn’t own the house so they don’t get to sell it. The heirs have a year to refinance or sell.

If the proceeds are not enough to satisfy the loan, the lender (or their insurance on the loan) absorbs the difference. This is a “non recourse rule” which entitles the lender to only the market value of the home and nothing more.

The other assets are safe.

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Your Questions About Reverse Mortgage Lenders

Mark asks…

Where can I find a list of the best Reverse Mortgage Lenders?

admin answers:

Anyways, you can find some info and resources about reverse mortgages here including a list of the top rated lenders:

http://reversemortgageresource.blogspot.com

________________

Robert asks…

where can I get a list of reverse mortgage wholesale lenders?

admin answers:

National Reverse Mortgage Lenders Association is you are on business side. Http://www.reversemortgagepage.com if you are a consumer.

Sharon asks…

How can I find a Reverse Mortgage lender?

And how exactly 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

________________________

John asks…

Can a reverse mortgage lender foreclosee on a home while it is still in probate?

admin answers:

Yes, of course, if the estate is not paying them they have every right to foreclose.

Laura asks…

how do i find the right reverse mortgage lender?

admin answers:

Don’t even think about it! Negative amortization is NEVER a good idea. Trust me, i deal with people everyday that owe more than their homes are worth because of reverse lending, very low arms that are now coming due etc….

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