Category Archives: Reverse Mortgage

What Are The Advantages And Disadvantages Of A Reverse Mortgage?

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Michigan is under a great financial challenge and it’s important for seniors to be aware of their options. There has been a lot of talk lately about Reverse Mortgages in Michigan. This is a great service that is available for Michigan seniors and offers a ton of benefits for home owners. These features can make all of the difference between just barely getting by or having a great life.

As seniors get along with age they will find themselves in need of having enough money set aside to pay for many extras. These include things such as prescription medication, medical care, home repair, and emergency funds. Many seniors like the ability to have this extra amount of income as it helps them stretch out the monthly budget.

Of course it is always nice to have extra money on hand to afford the unexpected extras. Some seniors take advantage of being able to travel and to go to see the world. They also enjoy being able to help out their family and loved ones. Others really enjoy being able to remain independent and to not be a burden on their sons or daughters.

Independence Is What It’s All About

Many seniors really like the idea of being totally independent. There are two sides to this great prospect. On one hand you can be totally independent of relying on your family. This can come in the form of having round the clock care from health professionals. To many seniors this can be a great luxury and add total peace of mind.

The other type of independence is having totally financial freedom from stress and worrying. It is like having a big weight taken off of your shoulders. Having total financial independence means having real freedom of choice. No longer will you have to worry about having to just “get by”. Having a reverse mortgage can really work miracles by adding a cushion of support in your daily life.

So you see having real independence really depends of two major things – financial freedom and having the freedom of doing what you want – whenever you want. That means that as a senior you get to live your life by your standards. You set the pace and make the rules. Having more money on hand gives you the opportunity to make a substantial difference in your life and in the lives of others.

In order to take advantage of the great features of a reverse mortgage you need to take in the pros and cons.

Advantages:

The cash payments you receive are tax fee since they are loan proceeds and not income, and they generally do not affect Social Security or Medicare benefits.

There are no minimum income requirements to qualify and no credit checks.

You can use the money for any purpose.

You may be able to create a cash flow stream for the remainder of your like.

Reverse Mortgages are complex. You must receive free, government-approved independent counseling. This is to insure that all of your questions have been addressed and that a reverse mortgage is right for you and your family.

Mortgage Insurance Premium (MIP) is the insurance required by HUD that protects you and your heirs from never owing more than the home is worth.

Disadvantages:

One of the biggest disadvantages of a reverse mortgage are the high closing costs. If you think you might be moving in the next few years a reverse mortgage may not be the best decision. This program makes the most sense for those who plan to stay in their homes permanently.

Reverse mortgages are relatively expensive. The interest is added to the loan balance each month, and the total interest you owe increases greatly over time as the interest compounds.

A reverse mortgage uses up the equity in your home, so it reduces what you have left to leave your heirs.

Kaye Reverse takes care of Reverse Mortgages for its many senior clients in Michigan. To see if a reverse mortgage is right for you and you are a Michigan homeowner log onto: http://www.kayereverse.com/dvd.html and get the FREE DVD.

Related Reverse Mortgage Articles

Reverse_Mortgage Online Quiz

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Reverse_Mortgage Online Test
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The Big Reverse Mortgage Question: Should I Stay Or Can I Offer?

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With a reverse mortgage, seniors are able to remain in their houses as long as they wish without having to sell their property or take on new monthly mortgage repayment. Seniors will never under any conditions caused by reverse mortgages, need to keep their domiciles providing they make their real-estate income tax and insurance coverage repayments and keep consitently the home in reasonable condition.

Also, unlike various other retirement tools or traditional financial loans, there’s no earnings qualification with a reverse mortgage. Consumers are not needed to make monthly mortgage repayments on a reverse mortgage through the entire life of the loan. The mortgage becomes repayable as soon as the last debtor on title sells the home or completely moves on. Additionally, the repayments amount wont go beyond the reasonable market value of the house.

Many home owners come to be contemplating reverse mortgages so they can pay off their current mortgages, equity loans and large interest charge cards. Attempting to sell and moving somewhere else are generally not really attractive to most seniors. Actually, most senior grownups choose to enjoy their particular your retirement within the comfort of these residence.

Unfortunately, seniors usually realize that unanticipated emergencies, increasing debt and medical ailments make staying in the home difficult. For seniors living on a set earnings, unforeseen and increasing prices may be economically crippling. Frequently seniors tend to be obligated to lower their particular standard of living or sell their home. Thankfully, with a reverse mortgage seniors are able to supplement their particular pension income and remain in their house for life.

The single simplest way to judge a reverse mortgage is to compare it as to what might your main option: attempting to sell your home and with the profits to buy or lease a fresh residence. Are you aware:

How much cash you can get by attempting to sell your property?

* exactly what it would set you back to buy (and keep) or hire a residence?
* How much money you can safely make on anything left-over after you buy a residence?
* Have you recently investigated purchasing a less pricey residence, renting a condo, or moving into assisted living or other alternate housing?

Until you have seen and considered various other housing options, how can you realize that another housing choice won’t be much better for your needs than a reverse mortgage? For you own satisfaction, consider just what else might-be readily available. It does not hurt to explore your choices before deciding.

Likely you can expect to started to 1 of 2 conclusions:

* You may find another housing option which far more appealing than you thought; or
* You may confirm that which you had been relatively specific of along: that where you live now’s where to be.

No matter what you conclude, you’ll have a far greater idea of the overall costs – and advantages – of remaining versus moving. That give you a much better feeling of something primary to you personally. After which it should be simpler for you to judge the costs and great things about a reverse home loan.

Kaye Reverse takes care of Reverse Mortgages because of its many senior clients in Michigan. To see if a reverse mortgage suits you and you are a Michigan home owner log onto: http://www.kayereverse.com/dvd.html and get the COMPLIMENTARY DVD.

NBC Today Show – The Pros and Cons of a Reverse Mortgage

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http://www.ReverseMortgageColorado.net In Colorado, Call Steve Haney to see how he can help you live your retirement the way you want to with a Reverse Mortgage. (877) 299-5500

The Today Show this morning devoted a four minute segment to the topic of reverse mortgages, spelling out the details of the loans for the increasing number of people who are interested.

Seeing more questions and more interest lately from those who qualify, Today’s financial editor Jean Chatzky answered questions on reverse mortgages, how they work, and whom they are right for.
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HECM stands for Home Equity Conversion Mortgage, popularly known as a Reverse Mortgage. Significant changes occurred on October 1 of this year and Rob Brinkman walks through not only the changes, but the basics of understanding how these mortgages work.

This video will explain many of the rules in order for you to do a reverse mortgage correctly, including what to watch out for and what loopholes can cost you money if not done correctly.

Find out why the maximum mortgage withdrawal went from 70% to 40% along with some other big changes that occurred after October 1st, 2013.

You will also learn about the adjustable rates on the new reverse mortgages and why the fixed rates are a thing of the past.

Popular among seniors, a Reverse Mortgage is a legitimate tool for income planning. As an Income Expert, Rob uses a case study of a typical retired couple living on Social Security, Pension and some Investment Income, to show a scenario that may typically apply.

To find out more about Rob and to download all of his free reports, check out http://www.retirementharvest.com

Nothing in this video can be construed as investment advice or can be used to fully make a decision on a reverse mortgage. This is simply the basic education on HECM’s and you should always consult a reverse mortgage expert before ever making any moves
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Latest Reverse Mortgage News

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So How Exactly Does A Reverse Mortgage Work? Steps To Getting A Reverse Mortgage

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1. Awareness

Homeowner learns about reverse mortgages from a development article, ad, word of mouth an such like.

2. Upfront knowledge

Homeowner contacts a reverse mortgage company for more information on reverse home loan programs. Demand a reverse home loan calculator or total free, no obligation evaluation from Kaye Financial.

3. Guidance

property owners seek counseling from a local HUD accepted counseling company, or a national guidance agency, like AARP (800-209-8085) Money Management International (MMI, 877-908-2227) or nationwide Foundation for Credit Guidance (866-698-6322). Counseling is necessary for several reverse mortgages and is conducted by phone.

By law a counselor must review (1) options aside from a reverse home loan that could be open to the prospective borrower, including housing, personal services, health and financial alternatives (2) other residence equity transformation choices that are or can become accessible to the potential borrowers including home income tax deferrals (3) the monetary implications of stepping into a reverse mortgage and (4) the income tax effects affecting the borrower’s qualifications under state of national programs and the impact on the estate for his or her heirs.

4. Application/Disclosure

Homeowner fills out financing application and selects a payment plan, whether fixed monthly obligations, lump sum payment, line of credit, or a combination of these. Lender discloses to property owner the predicted complete cost of the mortgage as needed by the federal truth in providing work. Homeowner provides lender with required information, including verification of Social Security number, backup of deed to home, all about any present mortgage(s) and counseling certification.

5. Processing

Lender orders an appraisal, that the home owners covers, to place a value from the home. The appraiser makes certain the shape associated with the home fulfills the FHA recommendations. If any structural problems are located, the homeowner must hire a contractor to perform the fixes following the reverse mortgage closes.

6. Underwriting

After obtaining all pertinent information and data, loan provider finalizes loan parameters with homeowner (for example., identifying repayment option, regularity of loan interest rate alterations) and submits loan package for last endorsement. It will take from 4-8 days (often sooner, often much longer) to underwrite financing bundle.

7. Closing

If the loan package is authorized, closing (signing) of loan is planned. Interest rates are calculated. Closing papers and final figures have decided. Closing prices are typically financed within the loan. Lender or name company has actually home owner indication the loan documents.

8. Disbursement

Homeowner features three company days after signing reports in which to terminate the mortgage. Upon expiration of the duration, the loan resources tend to be disbursed. Property owner accesses the resources in the form of payment alternative chosen. Any present debt regarding residence is paid off. A lien is laced regarding house. The property owner might use the loan profits regarding function. The mortgage “servicer” manages the account and it is responsible for disbursing monthly payments towards homeowner (if this program is opted for), advancing personal credit line funds upon demand, gathering any repayments exactly in danger of credit, and delivering periodic statements.

9. Repayment

property owner doesn’t make any monthly obligations during the life of the loan. The mortgage is repaid whenever home owner stops to reside the house as a principal residence. The loan can be paid back because of the home owner or even the heirs/estate, with or without a-sale of the property. The payment obligation cannot meet or exceed your home’s price or product sales price.

Kaye Reverse protects Reverse Mortgages because of its many senior consumers in Michigan. To see if a reverse home loan is right for you and you are a Michigan property owner log onto: http://www.kayereverse.com/dvd.html and get the TOTALLY FREE DVD.

Reverse Mortgage Loan Limits Remain In Place At Least until End of the Year

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Seniors counting on securing the most money they can from a reverse mortgage need to act now while interest rates are low and loan limits are high, according to Jim Cory from Legacy Reverse Mortgage.

The amount of cash available to homeowners through a reverse mortgage is limited by federal regulations. For now, the Federal Housing Administration (FHA) has decided to leave the limit at $ 625,500, but industry experts believe that could change come next year.

In response to the financial crisis, the FHA raised the maximum amount a reverse mortgage borrower’s property value could be calculated at from $ 417,000 to the current level in February 2009. FHA officials had previously announced that loan maximums would revert back to pre-February levels on October 1, 2011.

However, they now say the higher limit will likely remain in place at least through the end of the year.

October 1 is the beginning of the government’s fiscal year. Historically, officials make changes to many programs effective that day. So there is a possibility for seniors counting on maximizing the amount of money they can receive could be in for a disappointment if they wait too long.

Many industry experts expect to see a number of changes from FHA in the next six to twelve months.

These same industry experts believe that by acting now while interest rates are at records lows, reverse mortgage borrowers will maximize their options.

Regulatory uncertainty is only one factor driving seniors to consider locking in a reverse mortgage sooner rather than later. Low interest rates allow homeowners to unlock the most equity from their homes, while 10-year Treasury notes, a key industry benchmark rate, sit at historic lows.

In many areas, home values are continuing to decline. Since reverse mortgages limits are contingent on property appraisal amounts, borrowers are looking to lock in higher values before the real estate market gets potentially any worse.

The industry is doing all it can to help keep the higher loan limits so that seniors can get the most benefit from their homes.

Peter Bell, president of the National Reverse Mortgage Lenders Association has said, “We’re glad to see FHA take this interim step. It eliminates uncertainty for loan applicants who might have been concerned about not getting their loans before the limits possibly dropped.”

The focus now, according to Peter, will be on persuading HUD and lawmakers to retain the higher limit beyond calendar year 2011.

Since loan limits vary in some parts of the country, it’s also important that seniors considering a reverse mortgage contact a loan specialist to learn about the specific benefits available for their unique situation.

If you’re a California senior interested in learning more about securing the most money your home equity can afford you through a reverse mortgage, please take a moment today to call and speak with a Legacy Reverse Mortgage representative by dialing (800) 991-4613.

Legacy Reverse Mortgage offers Senior Reverse Mortgage services in California. If you’re a California senior interested in learning more about securing the most money your home equity can afford you through a reverse mortgage, please take a moment today to call and speak with a Legacy Reverse Mortgage representative by dialing (800) 991-4613.