FHA Reverse Mortgage

Waiting to exhale...

2008-01-27T16:35:00.000-08:00

Well, the FHA is geting ready, and so are lenders and borrowers alike. With the Economic Stimulus Package up next the President is just a signature away from siging in to law the legislation that will give thousands more Senior Homeowners access to what for many of them has become their only viable asset - the very home that they live in.

But timing is an interesting player in this mix. The conventional lending industry and it's supporting entities are reeling under the Sub-Prime meltdown. Then there is the housing market that is at very best "soft" in many parts of the country.

Thank goodness there is a refuge for those still fortunate enough to be over 62 and have enough equity in their homes to take advantage of a program who's time certainly has come.

While this new bill will lower a portion of the fees and costs associted with the FHA HECM (the financed origination fee will drop from a maximum 2% of the loan amount to 1.5%) this will be quite minor compared to the largest contribution to the overall cost, the FHA Mortgage Insurance Premium that remains at 2% of the loan amount.

What home owners and lenders alike a waiting for though is the FHA Countly Lending Limit to be increased to $417,000.00 for the entire continental United States. This represents a jump anywhere from 14% to more than double depending on the county.

This increase will allow hundreds of thousands more homes to qualify as well as give a tremendous opportunity for those already in a FHA HECM to refinace and take advantage of the gain in accessable equity. That is if their homes have appreciated, and held that appreciation.

Fha Lending Limits for Reverse Mortgage

2007-11-23T23:00:00.001-08:00

It's been a couple of months since the US House of Representatives approved a FHA reform bill, and the senate finance committee has already approved it.

Currently is it expected that the full US Senate will vote on this bill in early 2008.

Among the changes in the reform, seniors will have to pay for HECM counseling out of their own pockets. Fees could be as high as $150.

Until then, seniors can still get the required fha counseling for free. Your counseling certificate is good for 180 days after counseling. Contact me today and I will be happy to sign you up to qualify for your reverse mortgage today!

If you are waiting for FHA reform to pass senate, think again.

2007-08-27T01:24:00.000-07:00

The US House of Representatives had recently passed a bill for FHA reform. Some seniors are waiting to see if FHA limits increase in their areas. Limits are expected to increase to median home values for each county. However, in the last few weeks a few lenders have stopped offering the HECM monthly program that is currently the FHA reverse mortgage program that allows seniors to get the most cash out.

The FHA HECM is the safest loan out there, not only for the senior, the lender and their investors too! With recent fallout with mortgage backed securities, many investors are looking away from all mortgages all together. If investors continue to ignore investing in reverse mortgage backed securities, it could mean more lenders will stop offering the HECM monthly program.

Even with the senate passing legislation that would allow higher lending limits, without the FHA HECM monthly program, it could mean less cash for the seniors.

Waiting can be a gamble. If you need more information, just give me a call.

1-(866) 665-5497

U.S. HUD Secretary recommends FHA HECM Loans and other home equity conversion loans

2007-07-19T19:41:00.000-07:00

Reverse mortgages keep getting more and more attractive to senior home owners as the federal U.S. government continues to improve, modernize, and insure FHA Home Equity Conversion Mortgages, or HECM loans.

More and more senior home owners are reaping the benefits of reverse mortgages than ever before. The United States Department of Housing and Urban Development recorded over 300,000 seniors have used the FHA HECM loans with the FHA Home Equity Conversion Mortgage to convert the equity in their homes into cash and stop their mortgage payments for as long as they live in the home. Recently, the US Secretary of HUD had personally recommended the program to his older siblings!

In a summer 2007 public symposium on safeguarding homeownership, Alphonso Jackson, who is the U.S. Secretary of Housing and Urban Development proclaimed that FHA HECM loans play a critical role helping Americans over 62 stay in their homes.

Financial independence in retirement with the FHA HECM loans

2007-06-26T23:36:00.000-07:00

Americans senior citizens are living longer and healthier lives. Reaching retirement age no longer necessarily means growing weak. Financial security can be a large consideration that can help ensure better quality of life for our parents and for us. FHA Hecm loans are the most popular type of reverse mortgage and can help your parents live independent in their golden years, and balance their needs and wants with your own goals.

Living in their own home is important to most senior citizens. For the well-being of your parents and your own peace of mind, it’s important to plan for the future by considering the type of assistance they may need and want to live comfortably in their own home. It may seem awkward to talk to your parents about their finances, and it is important to know if they can afford to eat good foods, pay bills and enjoy their retirement.

Allow your parents to make their own choices and consider a FHA HECM reverse mortgage as just one option for a healthy retirement. Show understanding by focusing on your parents’ needs, wants, and worries about their current and future living situation. Compare the costs and benefits of remaining in their home with other possibilities.

Find information on a Reverse Mortgage in Washington or a Reverse Mortgage in California

Federal Housing Authority and the FHA Home Equity Conversion Mortgage

2007-06-11T07:18:00.000-07:00

By Ted Butler

About FHA home equity conversion mortgage programs for senior homeowners.
The FHA home equity conversion mortgage, otherwise known as the FHA HECM loan is the most popular reverse mortgage program. The government designed it to help keep seniors secure and in their homes as they enjoy the rest of their lives. A HECM loan is a special type of home loan that enables home owners to convert a portion of their equity into cash. The equity built up over years of home mortgage payments and appreciation can be paid to you. Unlike a traditional home equity loan or second mortgage, no repayment is required as long as your live in your home. The U.S. Department of Housing and Urban Development reverse mortgage provides these benefits, and the Federal Housing Authority's HECM loan is federally insured.

A Reverse Mortgage HECM Loan or FHA Home Equity Conversion Mortgage is working for more and more senior home owners each and every day.
The income received through a reverse mortgage can be used for whatever you want! You are not restricted in how to use the funds. Examples of potential uses for funds received through a reverse mortgage include:

Purchase long-term care insurance
Cover medical expenses and prescription drugs
Supplement retirement income
Make home repairs or improvements
Investments
Pay for in-home care
Pay property taxes

You could qualify for a Reverse Mortgage or the FHA Home Equity Conversion Mortgage
The eligibility requirements are easy. There is no income, employment or credit qualifying restrictions.

All homeowners must be age 62 or older and occupy the property as their principal residence.
The home must be owned free and clear or having a remaining mortgage balance which can be paid off by a reverse mortgage.
The home must meet HUD minimum property standards. Sometimes, home repairs can be made after the closing of a reverse mortgage.
The property must be a single-family home or a two to four unit dwelling.
Town-homes, detached homes, condominium unit, planned unit developments (PUDs) and some manufactured homes are eligible.

The amount you can receive is based on a few factors.
The maximum amount that can be borrowed is based on the following factors:

The age of the youngest homeowner.
The appraised home value.
The county of residence.
The current interest rate.

In general, the better your home is valued at, the elderly you are, and the lower the interest rate, the more money you’ll be able to borrow.

This is how you get paid money

Lump Sum – Cash is immediately available
Tenure – Equal monthly payments as long as at least one homeowner lives and continues to occupy the property as a principal residence.
Term – Equal monthly payments for a fixed period of months selected.
Line of Credit – A credit line which the customer can draw upon as he or she wishes.
Combination – Any combination of the above plans.

The Costs of HECM loans
Just like a typical mortgage loan, reverse mortgage costs include appraisal, credit report, title insurance, legal fees, loan origination, and recording fees. These normal loan costs can be included in your loan balance.

You may have an existing loan on your property.
The existing loan must be paid off prior to or at the settlement of the reverse mortgage. Often the reverse mortgage is used to refinance an existing loan.

Interest is charged in a way you can live with.
The interest rate on a reverse mortgage adjusts and is tied to readily available U.S. Treasury Bill indexes plus a margin. You are not charged any interest on money that have been approved but not yet withdrawn.

If your property is in a living trust.
If you are the primary trustee and are qualified by age, then yes.

If your children own the property in joint tenancy with you.
If the children are age 62 or older and live in the property. Other than that, they would need to be taken off title prior to settlement.

The HECM gives you tax free income.
The cash advances are tax-free. These advances are loan distributions and are not considered income.

If your spouse is permanently in a nursing home, you can still participate in a reverse mortgage.
Yes, only one owner must occupy the property as a principal residence.

It’s your money.
You can spend it as you please.

The lender can not take my home away if you outlive the loan.
You do not need to repay the loan as long as you or one of the borrowers continues to live in the house and keeps the taxes and insurance current. You can never owe more than your home’s value.

Manufactured homes
Yes, mobile homes built after June 1976 and have a permanent foundation that is approved by Federal Housing Administration with a certified engineer’s approval stamp.

Your estate goes to your heirs.
Your heirs will be able to choose whether to keep the house or sell it. They keep proceeds from the sale of the house, after the loan is payed off.