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With HUD loan limits increasing, do you still need a jumbo reverse mortgage in 2022? HUD just announced that for 2022 they will be increasing their loan limits for the reverse mortgage program known as the Home Equity Conversion Mortgage or HECM ("Heck-um") program. This is nothing new, HUD looks at the average prices of homes nationwide to determine the loan limits every year but what is so different about this year is that with the large house price increase that most areas of the country saw over the past... Read Full Article
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What is the "real cost" of the reverse mortgage loan and how is it computed? There are a few different ways that cost can be expressed. On a fixed rate loan, cost can be expressed as an annual percentage rate (APR) which is the amount of interest the borrower is charged for obtaining a loan as expressed by a single rate that represents the actual cost of funds after all costs the borrower paid to receive the loan have been factored in over the life of the loan. A very... Read Full Article
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Refinancing a Reverse Mortgage When a reverse mortgage borrower sees that current mortgage rates are potentially more beneficial than the rate he or she holds on an existing reverse mortgage closed in the past, it might be a good idea to investigate refinancing that mortgage to lock into those potentially more beneficial rates. While reverse mortgages carry many differences from forward mortgages, this ability to refinance into a lower rate exists for both types of products. This may be a surprise to some borrowers. Existing reverse mortgage customers across the... Read Full Article
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Although the costs to establish a HELOC (Home Equity Line of Credit) with a HECM (Home Equity Conversion Mortgage) are higher and you do have mortgage insurance premium (MIP) on the loan as well that does add an additional .50% to the accrual (the MIP is not interest but it accrues the same way), the interest rates for a HECM line of credit are very comparable to a Home Equity Line of Credit you would receive from a bank. Let's talk about the differences because they are immense We talked... Read Full Article
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A reverse mortgage is a loan for homeowners age 62 and over, which allows them to convert some of their home equity into cash. This explains its name: instead of a regular mortgage, where a person borrows money to buy a house, a reverse mortgage lets a person borrow money from the house that he or she already owns. It also explains the official name of the reverse mortgage backed by the Federal Housing Administration (FHA): The Home Equity Conversion Mortgage loan, or HECM. This name is another helpful way... Read Full Article
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In this article, you will learn: What Will a Reverse Mortgage Cost Me? What Are the Associated Fees? How to Find More Information If you find yourself looking around the internet for good information on the topic of reverse mortgages, you are likely to find no shortage of opinions and cautions from a whole host of people, ranging from those who claim to be reverse mortgage customers all the way through accredited financial professionals. In the process, you will probably end up asking yourself at some point: Are reverse mortgages... Read Full Article
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My parents have a reverse mortgage and have exhausted all funds with a negative available line of credit. My mother has been in a nursing home for over 2 years with Alzheimer's and my dad, who had been living in the house, passed away in December 2019. My brother and I are at a loss of best way to handle this situation. We have not yet paid the property tax bill, which was due on 01/31/20. We are confident that the current total loan balance may exceed the value... Read Full Article
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A reverse mortgage allows you to live in your home for life requiring no monthly repayments. Your benefit amount is based on borrowers' ages, property value, HUD lending limits and interest rates, not the amount you owe so you may receive only enough to pay off your existing loan on the home, but in many instances, borrowers receive a large enough benefit to pay off their existing mortgage and still give them additional funds for other uses. Heirs Have Indirect Benefits to Reverse Mortgages Firstly, if you need... Read Full Article
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If your mortgage is paid off, you are in a great position from the standpoint that you have no mortgage payments. But what if you still need more money every month to live on or just to be able to do the things you want to do? And taking out a Home Equity Line of Credit (HELOC) or other conventional type loan is not a viable option with the payments required? Benefits of a Reverse Mortgage Line of Credit The reverse mortgage will give you access to... Read Full Article
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So, you're thinking about getting a reverse mortgage, but you're not sure how the product will work best for you. Maybe you're hearing the downsides of the loan along with the upsides. Here is a look at the pros and cons of a reverse mortgage. Reverse Mortgage PROS/Upsides Pro: It helps seniors stay in their homes. While there are several reasons to access a reverse mortgage, among the best known is the opportunity the product presents to fixed-income seniors seeking funds for their basic needs. For this population,... Read Full Article
