While the details are still sketchy on how the various rules are going to be implemented, one of the larger changes is in how much cash the senior can put into their pocket at closing. When the borrower owns their home free and clear, then the amount of cash draw at the initial closing will […]
2013 HECM changes part 2
As I indicated a few weeks ago the HECM reverse mortgage is going to see some significant changes. The details of how these new rules are going to be implemented have yet to come out fully, however here are some of the highlights of what to expect. Lower loan amounts based on the age/home value […]
More HECM changes on the way?
Last week Congress gave the FHA authority to stabilize the Home Equity Conversion Program (HECM). Since HECM’s make up the majority of reverse mortgages this is something we need to watch carefully. The exact implementation of this “stabilization” is not clear, but if it’s anything like the stabilization efforts on the forward mortgage side we […]
Can the property be held in a trust?
Trusts are normally allowed in a reverse mortgage. The trust typically must be revocable to qualify. In some cases, the lender’s underwriting group may determine a particular trust is not acceptable. An unacceptable trust can usually be rewritten to comply and then be accepted, or the home may be removed from the trust to complete […]
What is a HECM Saver Reverse Mortgage?
In October 2010 the Federal Housing Administration launched a new reverse mortgage called the HECM saver. In exchange for the borrowing taking a lower loan amount, the HECM Saver charges drastically lower up front fees. HECM is short for Home Equity Conversation Mortgage, the reverse mortgage program insured by the FHA. The vast majority of […]
Do I need to own my home free and clear to get a reverse mortgage?
I enjoy answering your questions, please call or email me for a personal, timely and accurate response. You do not need to own your home free and clear to get a reverse mortgage. The proceeds of the reverse mortgage can be used for any purpose, including paying off the current mortgage and any other liens […]
Why should I get a reverse mortgage instead of a home equity loan?
There are a number reasons why a reverse mortgage can be a better choice than a normal home equity loan for homeowners 62 years or older. It is an individual decision, but some of the common reasons a reverse mortgage makes more sense are: Never having to make a mortgage payment. Any payments are optional. […]
Does a condo qualify for a reverse mortgage?
A condo in a HUD approved homeowners association (like Rossmoor) is qualified for reverse mortgage. Co-operatives are not eligible for a reverse mortgage according to HUD. From time to time there is a proposal to add Co-ops to the eligibility but as of today that is not the case. Single family homes both with and […]
Are there restrictions on how I use the income from a Reverse Mortgage?
Other than having to pay off any existing liens on your property (a prior mortgage, home equity loan, tax lien, etc.), there are virtually no restrictions on how a reverse mortgage may be used. A few of the more common uses we’ve encountered include; cash for daily living, pay for medical expense, consolidate debts and […]
How do I qualify for a reverse mortgage?
There are two qualification for a reverse mortgage, your age and your home. In order to qualify for a reverse mortgage you must be 62 years of age or older. In the case of a married couple the youngest spouse must be 62 years old. No other credit or income requirements are reviewed. No minimum […]