Reverse Mortgage News

The reason that most seniors start looking into the option of obtaining a reverse mortgage home loan is because they want to be able to stay in their homes long after they have retired. They worked hard to be able to achieve the American Dream of owning their own homes and they want to be able to hang on to that dream even after their income has decreased due to retirement. So they take out a reverse home mortgage loan in order to continue to afford their lives and their large homes.

However, a recent article in the Topeka Capital-Journal suggests that there might be another kind of home that seniors can use their reverse mortgage money for: the nursing home. As seniors start to get up into their later years, they may find that they can’t continue to live on their own in their homes. They can afford to because of the help from their reverse home mortgage but their personal needs are such that they need the kind of care, security and personal assistance that most people have to go out-of-home to obtain.

The article, which is primarily about medical fraud from people who can afford nursing homes but are cheating the system, suggests that obtaining a reverse home mortgage is one legitimate way to afford nursing home care. CNN Money makes the same suggestion. Nursing homes are undeniably expensive and many families struggle to pay for the care that elder folks in the family may need. The reverse mortgage allows the individual to move out of the home when the time comes but to be self-supporting in the nursing home. This relieves the family of the burden of paying for the final years of care that the individual requires.

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James Garner, better known to most people as the actor from Maverick, can be seen on television these days in a much different role. Garner speaks in a television commercial about the value of the reverse home mortgage for seniors. He’s speaking about specific reverse mortgage loans and services from a certain lender, but it shows his general support of using reverse mortgage loans to access a line of cash and build yourself increased financial stability in your older years.

Garner will be eighty next year. And he’s not the only old timer who is speaking out in support of the reverse mortgage loan. Another company also has a reverse mortgage spokesperson who is known for his roles on television and film. Robert Wagner is only slightly younger than Garner and is well within the age restrictions (minimum of 62) for receiving a reverse home mortgage. He speaks for another company in direct competition for reverse mortgage lending.

Of course, you don’t want to select your reverse home mortgage loan based solely on the celebrities who endorse those products. You’ll want to get reverse mortgage information from more reputable sources. And you’ll want to choose the loan that’s right for you, not the one that is supported by your favorite reverse mortgage celebrity endorsement. But it’s comforting to know that these guys are willing to put their names on the line and let others know about their options when it comes to financing life in your older years.

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New York City is a city for the young and fabulous. Right? Sure, but those aren't the only people who are living in New York. When you think about the typical person who lives in a Manhattan co-op apartment, you probably think of a beautiful and successful thirtysomething single person or perhaps a young urban couple. But the truth is that a co-op in Manhattan is expensive and the people who live in them have often taken years to gain the kind of financial success and security necessary to live there.

In some cases, they have taken many years to get to the point of being able to afford a New York City co-op. And once they've achieved that success, they maintain it for a few years. But then they find that retirement age is creeping up on them. They love the city but there is no way that they are going to be able to afford to continue living in their co-op on their retirement income. What does a New York City co-op owner do in this case?

Many are considering the option of taking out a reverse mortgage loan. As described recently by Grand Street News, co-op owners can access the home equity of their co-op apartment in New York just as home owners would in any other city in the nation. The amount of money they can access (via lump sum, monthly payments or a line of credit) may even be greater than it is for their counterparts in the rest of the country because of the high value of Manhattan co-op real estate.

It should be noted that co-op owners have one more hassle to deal with than others applying for a reverse mortgage loan. The reverse home mortgage for the co-op must be approved by the co-op board. However, since these people have been dealing with the board for years, they're probably used to that minor hassle. And it may be well worth the cost of not having to give up a prime Manhattan location just because you've decided you're done with work on Wall Street.

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You know basically how a reverse home mortgage works: you access the equity that you have in your home to obtain money to support you after retirement. However, you might not be certain of exactly how receiving that money works. Can you take out as much of it as you want? Do you have to obtain all of the income at once?

As described in a recent Forest Grove News Times article, there are basically four different ways that you can access money from a HUD reverse home mortgage loan. The most common method of doing so is to receive monthly payments from your loan throughout the duration of your life. This allows you to garner steady income after retirement to assist you with paying for the home and any improvements it may need as well as financing other areas of your life that may be lacking if you didn't do your retirement planning efficiently enough.

Another option that many people consider for their reverse home mortgage payments is accepting a lump sum of the money. This is often done when the young retiree is interested in using the reverse mortgage for investment purchases. It may also be done as a means of paying off other high income loans to reduce the amount of money owed out in later years.

Another option that some people consider with the reverse home mortgage loan payments is a line of credit whch can be accessed as needed. And the final option mentioned in the article is the option of combining some or all of these methods. You can work with a financial planner and a reverse mortgage lender to figure out which method of accepting payments makes the most sense for you.

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Some people think that the reverse home mortgage is a terrific thing. Others report that it's terrible. Where does the truth lie? The reverse home mortgage can be an excellent way of accessing money to allow you to continue living a full life in your own home after you have retired. However, you must understand the reverse mortgage completely in order for it to benefit you. Most people who believe that the reverse home mortgage is a "bad" thing feel that way because of a misunderstanding about the way that the reverse mortgage works.

A recent alert by News Channel 5 pointed to the biggest problem which causes confusion for people who take out a reverse home mortgage loan. They fail to understand that they may be giving up their home in exchange for the money that they are receiving. This doesn't mean that their home will be sold out from under their feet, leaving them with nowhere to live. In fact, the opposite is true; the reverse mortgage allows elderly people to continue living in their homes when they may not otherwise be able to do so. The alert breaks it down:

Reverse mortgages are attractive to many seniors, particularly those who are not concerned with leaving behind property for their relatives or friends to inherit. But homeowners who are considering a reverse mortgage need to know that these agreements significantly reduce or eliminate the inheritance that would have otherwise gone to their surviving loved ones.

Those senior citizens who understand that they are accessing the income of their home in exchange for the home going to the lender when they pass away (or sell the home) can make an informed choice about whether or not the mortgage is right for them. Many wonder what will happen to their spouse; the spouse is covered under the mortgage and may continue living in the home until passing away or selling it. It is only those people who wanted to leave their homes to their children who will need to think carefully about the consequences of the reverse home mortgage. Working with professionals can make the decision easier to understand.

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The National Association of Mortgage Providers recently gave its stamp of approval to the Federal Housing Administration's Reverse Mortgage Program. In fact, they are so supportive of the program that they are urging all mortgage lenders to receive training to better assist senior citizens in understanding the benefits of the reverse home mortgage. The organization has teamed up with the FHA to offer online classes to mortgage professionals who are interested in becoming better acquainted with this important area of mortgage knowledge. The hope is that more trained people will lead to more widespread understanding and use of the reverse mortgage for senior income.

It follows then that NAMP would probably be strongly supportive of encouraging reverse mortgage borrowers to work with a professional who is trained and up-to-date in the details of the reverse mortgage. "Gone are the days of one reverse mortgage product fits all. Reverse mortgages are as diverse today as are the situations they are designed to fit," says Jenny Rasico, instructor at FHA Online University's Reverse Mortgage course.

The savvy reverse mortgage borrower will make sure to be informed before going to speak with a professional in order to be able to ask the right questions and get the most assistance from working with the lender. You'll want to know how you can receive payments, what qualifications you must meet and what this will mean for the duration of the loan. You should also consider working with a financial planner to appropriately budget the money from the reverse mortgage loan. As emphasis is placed on better training of professionals, it should become easier and easier to work with lenders and planners to make the most out of your loan.

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A recent blog post breaks down nine different ways that seniors can increase their retirement income so that they can live fuller, richer, more comfortable lives in their later years. Of course, the reverse home mortgage is listed as one of those ways. Since the reverse mortgage lets you access cash from the equity of your home, you have a steady stream of income that you might not otherwise have planned on coming from this source.

Convert 'lazy' money trapped in your home equity into an excellent long term cash flow, enabling you to enjoy greater income and financial security without putting your cash in any high risk investments.

In addition to the reverse mortgage, the author of the posts suggests means of accessing income in retirement which include structured life settlements from insurance, better attention to potential tax breaks and the use of "tenants in common". Your best bet is probably to do your research and work with professionals in the real estate and financial fields in order to make the choices that will allow you to increase your retirement income without jeopardizing your security during retirement.

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Two years ago Liane Dunn was sued because gasoline tanks on her property had leaked, causing significant environmental damage to the area surrounding her home. (You can read about the whole story from the Litchfield County Times.) The damage to the property resulted in a bill from Environmental Serivces Management Inc. which totaled over $100,000. That's money that Dunn simply didn't have.

What Dunn did have, however, was her property. She was able to acquire a lump sum payment using a reverse mortgage loan so that she could afford to make the payment that the company was requiring. She is currently looking in to whether or not she can get reimbursed by the government for that payment because of the unique circumstances surrounding the case. But even if she can't, at least she didn't lose her property because the reverse mortgage loan allowed her to access the income that she needed to cover the unexpected cost of damages.

The reverse mortgage can be used for a number of different things in life. It may be an investment tool or it may be a way to continue living in your home after you have retired. This case is an example showing that the reverse mortgage can also be useful in emergencies, when expenses you never would have thought could occur crop up in your life.

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One of the most terrifying experiences that senior citizens can go through is having to face filing for bankruptcy. After all, it is kind of anticipated that you'll be dealing with such traumatic life experiences as major illness, medical changes and transitions into retirement. These things may be difficult but the expectation of them eases their terror. Bankruptcy is not something that you imagine having to deal with when you get older. But unfortunately, an increasingly large number of people are filing for bankruptcy in their later years.

"With U.S. bankruptcy filings up more than 40% this year, Americans 62 years old and older should realize they may be able to avoid bankruptcy by applying for a reverse mortgage loan." (Source: press release).

Bankruptcy late in life is frightening because it comes with no safety net. When you are young, bankruptcy is difficult but you have the security of many years of employment in your future to assist you in getting back in your feet. As a senior citizen, bankruptcy has permanent ramifications.

However, the senior citizen has a benefit that younger people do not have. That's the ability to access home equity through the reverse home mortgage. This provides a way to avoid bankruptcy and all of the fear that come along with it. You'll be able to pay your bills and continuing living in your home despite the fact that money isn't coming as easily as you hoped after retirement.

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The kids have grown up and left the house. You've stopped working so many hours (or perhaps have entered full retirement) and actually have a chance to spend some time at home. You and your spouse are enjoying the quiet evenings together in the house that you have spent a lifetime in. But after the novelty of having a quiet house to yourself wears off, you start to notice something. The house isn't in very good shape.

As we are going through the busy days of a middle-aged life, we often simply don't realize that our home needs as much as maintenance as it does. Sure, we know that there's the hole in the wall from when Jimmy got mad as a teenager and threw a fist into it. But it's covered by a picture and we never got around to fixing it. We may realize that the roof is old but it doesn't leak so it didn't demand our immediate attention in the midst of the chaos of a full life.

After retirement, when you and your spouse have the house to yourself again, you start to notice these things. And you wonder how you are ever going to be able to afford to make all of the repairs that you are suddenly seeing should be made to the house. The reverse home mortgage loan may be the answer to your problem. You can access money from the equity of your home and use it to make those improvements. The value of the home will actually increase and you'll be able to enjoy the rest of your days in this refreshed location.

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Social networking online is an increasingly important aspect of the business world. People join professional social networking sites such as LinkedIn and Facebook because they want to meet others with whom they can do business. However, there are other uses for these social networking sites and a few savvy seniors are taking advantage of those opportunities. Many of them are joining social networking sites in order to discuss information about important aspects of senior life such as the reverse mortgage loan.

Social networking groups simply serve to connect people who have similar interests. You can go on the sites, set up a basic profile including your interests and start meeting other people with similar interests. This allows you to connect with others who are going through the same changes in life that you are, even though they may be located on the other side of the country (or even the other side of the world).

Social networking sites allow groups to form around particular topics. They also allow for forum discussions between people who have questions and concerns about the same issues. By joining a social networking group, you can exchange information about your reverse home mortgage with others who are also involved in the process. It can be a terrific way to determine whether your reverse mortgage is a good one and what changes might need to be made to improve it.

Plus, as you get older, it's always nice to just meet new people. The reverse mortgage lets you stay in your home and you may find that you want to stay inside there more than you used to. You can still meet people by networking online. There are even social networking sites (such as Elders Voice) which are specific to senior populations. It's a win-win situation.

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For the most part, a reverse home mortgage is a good thing. It provides senior citizens with access to money, giving them financial security after retirement. It allows them the flexibility of choosing to get a lump sum payment to pay for emergency expenses or to get monthly payments to afford life in general.

But there are problems that can occur for people who take out a reverse mortgage loan. Usually these problems come about as a result of the fact that the individual taking out a reverse mortgage doesn't fully understand the details of the transaction. Such problems can be avoided by making yourself aware of the potential problems in advance of taking out the reverse mortgage.

An article at Best Syndication lets you in on five key ways that seniors tend to get taken advantage of with the reverse home mortgage. They say that the complexity of the reverse mortgage is often confusing to seniors, especially because the terms of different mortgage lenders may not be the same. They also point out that reverse mortgage fees and shared appreciation clauses can cause the individual to spend money on the reverse mortgage unnecessarily.

To avoid these problems, it is highly recommended that you educate yourself about the reverse mortgage loan process. You should take advantage of the courses offered by AARP. You should also work with finance professionals to make sure that you understand the entire transaction. It is only a failure to arm yourself with information that will make the reverse mortgage loan a bad thing when it should be a positive addition to your life.

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We want our reverse mortgage lenders to be experienced in finance. We assume that they have the mathematical skills to do their jobs correctly. But the fact of the matter is that you don't really need to be able to add and subtract to be able to work out a mortgage. You just need to know how to feed the right information into the computers and calculators that do the math for you. For that reason, it actually matters more that our reverse mortgage lenders have the right tools and technology than that they have math skills.

As new technologies are developed, savvy reverse mortgage lenders work to see if these tools are right for them and their clients. Most new technology is designed for accounting and so it doesn't all apply to the reverse mortgage lender. But occasionally there is a new product on the market geared towards this specific subsection of people. Such is the case right now with the release of the Mortgage Cadence Prelude.

This new tool is Point of Sale mortgage software which has functions specific to the reverse mortgage loan. “There is a need in the market for point of sale technology that allows originators to satisfy customers more effectively,” said Michael Detwiler, CEO of Mortgage Cadence. “This market is growing very rapidly and the software lenders are offered to serve customers is sorely lacking. Mortgage Cadence Prelude will be as easy to use as the simplest forward lending origination software, but will include the specific functionality required to originate reverse mortgages.”

Of course we want our reverse mortgage lenders to have some basic finance skills. But it's also important that they have access to the technology that can do more complex math for them.

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People who pay attention to mortgage news know that there has been a lot of bad news in the business over the last year or two. However, those folks who pay close attention to the world of mortgages also know that not all mortgages are suffering. There are some mortgage loans that are going strong, to the benefit of both lenders and borrowers. One of those is the reverse mortgage loan, of course. Two others that are doing well are FHA refinancing loans and ARM mortgages.

In a recent press release, award-winning marketing educator Scott Tucker let mortgage lenders know about the importance of focusing on these three types of loans in order to grow their businesses. As a result, you will likely see a growth in promotional offers that advertise these different types of mortgages. Lenders know that their market is suffering and they want to get the business that they can in order to stay afloat in these troubled times.

Does the fact that mortgage lenders are going to try to sell you on these loans mean that you should consider it "junk mail" when these promotions arrive? Not at all. These loans are great in the market right now because they're the only mortgage loans which are really beneficial to people at the current time. If you qualify for something like the reverse mortgage loan, you should use this marketing push as an opportunity to find a lender who is right for you.

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You could have a dozen reasons for considering getting a reverse mortgage loan. But on the whole there are only three major reasons why the popularity of the reverse home mortgage has grown considerably in the last few years.

"There are three main long-term factors suggesting that reverse mortgages are set to become more common in industrialized countries. These are an aging population, insufficient retirement incomes and equity wealth. Most developed countries have an aging population and improving public health, which will continue to make senior citizens' final years more active. In many developed countries, pension contributions have not kept pace with the aging population. Moreover, the last decade has seen a global property boom, with residential properties soaring in price in developed economies across the world." (Source)

This information comes from a news report about the state of reverse mortgage loans in Australia. There are some important differences in the reverse mortgage loan market between this country and the United States. Namely, the market in Australia has taken a hit in the last year while the market in the U.S. has only grown. But there are enough similarities between the populations of these two countries to make the prediction that reverse mortgage loans will grow in both areas a reasonable one to rely upon.

One of the things that we can learn from the reverse mortgage market in Australia is that part of the reason that the market appears to be bad is that there are more lenders than borrowers. Lenders are going out of business because there is more supply than demand. But this can mean good things for borrowers. With more lenders to choose from, competition is better and quality of customer service is likely to go up. Here in the U.S., working with qualified lenders helps to guarantee more positive results from the reverse mortgage experience.

With the baby boom generation getting older, we now have a larger population of seniors than ever before. As these folks retire into healthy and active lives, they need to maximize their income. The reverse mortgage loan allows them to do this whether they live here or somewhere overseas.

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Sixty two. That has long been the magic number for people who are interested in reverse home mortgage loans. Nearly all reverse mortgage lenders require that you meet a minimum age requirement of sixty two before you qualify for a loan. In fact, this is pretty much the only requirement (besides being a homeowner, of course) that applicants need to meet in order to qualify for a reverse home mortgage. And now things are changing so that you might not even need to meet that requirement anymore.

Some lenders are starting to recognize that there are baby boomers who aren't quite 62 but who are at an age when they're starting to think seriously about the benefits of the reverse mortgage. These people realize that their home has monetary value that they can access for any number of different uses. Many of these people have taken an early retirement and are ready to go live it up. They don't want to have to wait for that magic 62 to roll around before being able to afford travel, home repairs and other expenses.

You still have to be up there in age to qualify for the new reverse mortgages. The minimum age requirement is only dropping from 62 to 60 for the lenders that are making the switch. But it's a start. The reason for the change is that the oldest of the baby boomer generation just turned 60 and those folks are in a terrific position to make use of this kind of mortgage. As this generation continues to age over the next few years, we may see an even more diverse selection of reverse mortgage changes to suit the needs of this population.

If you're nearing the age at which you're starting to think about a reverse home mortgage, you should start looking in to your options. You might not quite be ready for the market, but the market is getting ready for youl. Consider discussing your choices with a financial planner to begin making the right decisions early on.

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The reverse mortgage loan process used to be fairly simple. You took yourself to a lender, proved that you qualified as a homeowner over the age of 62 and worked out the details for getting the loan. But the reverse home mortgage has changed considerably over the last few years. There are now not only a range of different lenders to choose from but also a variety of options for different kinds of reverse mortgage loans.

Variety is terrific. It can help you obtain a reverse mortgage which is more suited to your specific financial needs than a "one size fits all" loan is. But it also means that there are more decisions to make when getting a loan. You have to figure out what kind of loan to get, what kind of payments you want to take and which specific terms are best for your needs. It can get a little bit overwhelming.

There are two important things that you can do to reduce your confusion as you apply for a loan. The first is to arm yourself with information. Do your research, talk to your AARP representative, be willing to ask questions and search for answers. And the other thing you need to do is work with a financial professional who can help you sift through the details. As mortgages change, your options open up. You just might need a little help seeing what those different options are all about.

For additional information about the many different choices to be made in the Reverse Mortgage market today, check out this Wall Street Journal article.

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Each year The Solano Hispanic Chamber of Commerce honors a member of the Solano County community. This year, the recipient of that honor is Carlos Trevino, the Senior Advisor of MLS Reverse Mortgage. This is not only an important honor for the individual himself but also an honor for the reverse mortgage community. It goes to show that the work done to assist the elderly in accessing income from their homes through reverse mortgage lending is being taken seriously by California communities.

Trevino has a lifetime history of helping out his community through a number of volunteer efforts and career moves. In 2004, he recognized that there was a problem in his community for elderly people who were unable to afford the rise in healthcare costs and other life expenses that were plaguing them. He also recognized that the reverse mortgage was a way to assist these people with their problem. It was at that time that he focused his efforts on becoming a reverse mortgage advisor.

Learn more from the press release.

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With the baby boomer generation getting older, more and more people are concerned about their retirement. These people want to make sure that they are able to retire in style without having to worry about financial stability in the years to come. But these people also have a significant amount of debt to their name so they're not quite sure how they're going to make that financial security happen.

A recent news report helped answer that important question by providing seven different ways than seniors can boost their retirement. The report's suggestions ran the gamut from postponing retirement for a few years to investing retirement savings in the stock market. Making the list of top seven ways to improve retirement was making use of reverse mortgage loans.

Although the article also suggests downsizing to a smaller home to reduce post-retirement expenses, the author must have recognized that many people want to remain in their homes even after retiring. The reverse home mortgage allows for this to happen while also providing an additional source of income to the individual for other expenses.

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You might not yet be interested in reverse mortgage information for yourself. Perhaps you're starting to get close to retirement age and have thought about your options for taking out a reverse mortgage but have determined that it's not yet right for you. Could it be the right move for your parents?

Many middle-aged adults these days are worried about providing for their own aging parents. Although some parents have the foresight to take the pressure off of their adult children by getting a reverse home mortgage themselves, not all of them are willing to make this step on their own. If you're concerned about how your parents are going to pay for their lives as they continue to get older, you might want to start seeing if you can assist them in accessing money through a reverse mortgage.

Some people feel uncomfortable dealing with this aspect of their parents' lives. It's their house and their money and you might feel awkward bringing your own opinions to the table. But if you're worried about the costs of caring for your parents, it might be in your best interest to bring up this option now. One choice you have for some emotional relief is to join an online community for adult children caring for their parents. (One option is Caring.com.) You surely aren't the only one who is considering urging your parents to get a reverse mortgage. Talking it over with others in the same position might help.

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Last week, The Miami Herald published a reader's question about reverse mortgages. The reader had asked about whether or not obtaining a reverse mortgage was safe. The cause for concern was that the reader's credit union didn't offer reverse mortgages. As explained in the article, reverse mortgages are indeed a safe option for accessing cash, assuming that you work with a credible lender and stay smart about the process.

Not all banks, and particularly not all credit unions, are going to offer the reverse mortgage loan. This is due in part to the fact that this is a somewhat specialized loan. You want to make sure that the lender that you work with is trained specifically in assisting you in getting this loan. This is particularly true as reverse mortgages begin to change and take on new terms.

To maximize the safety of taking out a reverse mortgage loan, you should make sure that you understand all of the terms of the loan agreement. Read everything carefully. Work with a finance professional to better understand every aspect of the loan. And then make sure that you've determined the loan is right for you before forging ahead. By covering your bases and working with a reputable lender, you'll make the reverse mortgage loan not only safe but also beneficial.

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If you're looking to add to your library and you're interested in reverse mortgages, these five books are a great starting place for getting some basic information about the topic:

1. Reverse Mortgages for Dummies - No one is saying that you're a dummy but if you're a fan of the way that this series breaks down information into bite-sized digestible chunks then you might find that your understanding of reverse mortgages increases as you read it.

2. The Complete Guide to Reverse Mortgages - This book (subtitled Turn Your Home Equity into Instant Income) is a step-by-step guide to obtaining and using reverse mortgage income.

3. The New Reverse Mortgage Formula - This book (subtitled How to Convert Home Equity into Tax-Free Income) is authored by Tom Kelly, a prolific writer who has extensive knowledge in writing for the senior reading market.

4. The Reverse Mortgage Advantage - This book is subtitled The Tax-Free, House Rich Way to Retire Wealthy! That sums up the difference between this book and many of the other reverse mortgage books on the market.

5. The Reverse Mortgage Handbook - This book (subtitled A Consumer's Guide for Senior Homeowners) covers the ins and outs of three different types of reverse mortgages and includes examples to help you better understand them.

Of course, you won't want to get all of your information from books. You should also consult a finance professional to assist you in applying what you've learned to your own loan. But these books are a good start for learning what you need to know before you seek out that assistance.

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