Reverse Mortgage News

The American Dream is synonymous with home ownership and The United States House of Representatives showed their belief in this dream recently when they passed the Expanding American Homeownership Act of 2007. This act makes a number of chances to the Federal Housing Administration’s home loan programs, making it easier for prospective home owners to get the loans that they need to achieve the American Dream of owning their own house.

One of the major areas of change that would come along with the passage of the Expanding American Homeownership Act is in the area of FHA reverse mortgage loans. The new act would increase the loan limits that would be available to allow people with an interest in reverse mortgage loans to access all of the money that they need. The act would also limit the fee amount that lenders are allowed to charge on reverse mortgage loans to make paying for them a more plausible possibility to more people. Additionally, the changes would remove existing loan caps which currently threaten to shutdown reverse mortgage programs, making the program itself more viable in the long term.

In addition to the FHA reverse mortgage loan changes, a number of other changes would occur as a result of the passage of this act. They include zero or low down payments for home loan borrowers, additional funding for sub-prime mortgage borrowers and other pro-home-buyer changes. Although the House of Representatives has passed the act, it’s not yet going into effect. The Senate will need to show its same faith in the American Dream before it can be realized.

The way that reverse mortgages work is that homeowners borrow money against the home, allowing them to receive annual payments to assist them with their standard expenses. In recent months, there has been a large increase in reverse mortgages across the entire nation. However, new reverse mortgages seem to be far more popular in liberal areas of the nation than they are in more conservative states. For example, Alabama isn’t very interested in reverse mortgages. Although there has been some small increase in their popularity throughout the conservative state, Alabama remains behind the nation in reverse mortgage trends. This is probably due to the fact that there are negative associations with reverse mortgages by those people who don’t understand how they work. Many older people fear that getting a reverse mortgage is the equivalent of giving away their home to the bank. However, under the right circumstances, reverse mortgages can be a good way to get much-needed cash so people in Alabama may want to start jumping on the trend.

Massachusetts citizens with an interest in reverse mortgage issues can attend a forum happening today to learn more about the topic. The forum is being held at the Yarmouth Senior Center in Yarmouth, MA at 12:30 today. It is hosted by the Massachusetts H.O.M.E. Consortium and the Consumer Assistance Council and will be attended by Senator Rob O’Leary as well as U.S. Representative Bill Delahunt.

The goal of the forum is to educate seniors in the state about reverse mortgages. It is a free forum which allows the elderly in the area to learn about all of their different options in terms of homeowner income. Many elderly folks are afraid that they’ll be taken advantage of due to their lack of information on the topic so this gives them a chance to really empower themselves with the knowledge that they need to take advantage of reverse mortgages.

If you aren’t in the Yarmouth area or can’t make it to the forum, you can still empower yourself with this knowledge by learning all that you can on reverse mortgages. The better that you understand the way they work, the better you can assess your options and take advantage of making them work for you.

Financial Freedom Senior Funding Corporation, known more commonly as just Financial Freedom, is one of the largest originators of reverse mortgage loans in the United States. They have over 130,000 loans in their portfolio which allows them to meet the needs of a wide range of home owners. And a new press release indicates that they’ve got something new to offer in the form of their first government-insured fixed-rate closed-end reverse mortgage.

The new offer is called HECM Fixed Rate Product. Financial Freedom says that the unique terms of this offer make it idea for seniors who are the ones with a vested interest in reverse mortgage changes. And they’re so confident in the quality of their product that they are predicting that it will be replicated as the model for widespread adoption across the industry. If this does take place, it would create an industry standard for reverse mortgages which would be in the financial interest of consumers, allowing for a low fixed rate on the reverse mortgage for the lifetime of the mortgage.

An article in Realty Times last week indicates that retirees aren’t as concerned about the housing market as they maybe ought to be. Although elderly retired folks and those who are working but about to retire are both populations which are highly concerned about financial issues, they aren’t people who seem excessively concerned about their homes. Most plan on keeping the homes that they own and many aren’t even looking into reverse mortgages to help them use those homes as a source of income. This means that people are worried about money but aren’t aware of the things which could help them ease those woes.

Retirees might be able to get by without a reverse mortgage if their homes are paid off and they can manage the rest of their finances. However, those older folks who have not yet retired but are about to don’t have it so easy. Most of them haven’t even paid off their homes yet so they don’t have the same luxuries of financial freedom that their older counterparts have. Both groups of people may find that their home is more of a burden to them than a safe haven if they don’t learn how to access the income that it could supply them with as they age.

Despite this, most of these folks are concerned about everything other than what’s going on with their homes. Concerns cited as topping their lists include outliving their saving, an inability to pay for basic expenses and the effects of inflation as they age. These are all issues which can be resolved with good retirement planning but people have to look at all of the options - including accessing income from a reverse mortgage on their home - if they want to know how to solve their concerns.