Reverse Mortgage News

If you were retired and ran out of money, what would you do about it? A recent survey indicates that baby boomers asked to make that prediction tend to have an independent spirit which suggests that they would be more likely to return to work after retirement than to rely on others for assistance. However, if you've already retired, are you really going to want to start working again? And for how long will that resolve your problems?

Also listed on the survey as answers to this question were responses as idealistic as "I'd pray" and as rooted in common sense as "I'd take out a reverse mortgage". If you're older and able to work and you're interested in continuing to earn money after your first retirement, go for it. There's nothing wrong with earning your way. But if you're getting up in age and the honest answer is that you'd just like to enjoy your retirement, other options may make more sense.

The reverse home mortgage loan is one option that lets you keep your house, pay your bills and not have to go back to work. The same survey asked people what they would tell their younger selves about retirement and the answers were mostly related to saving better and planning more for the future. If you didn't do that when you were young enough, the reverse mortgage could be a way to do that now. You can use it to fund your future and create the kind of financial stability you hoped that you would have by this point in your life.

Question of the Day: What one thing would you change about the way you did retirement planning?

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Where do you go to get your reverse mortgage information? Hopefully you check this blog for the latest news about the topic. You probably also work with a finance professional or someone from an organization like AARP to see how reverse mortgages will work specifically for you. If you've applied for a reverse mortgage home loan, you've also taken a basic class in it since this is a requirement of getting the loan. But have you thought about actually going to school to learn about reverse mortgages?

If you thought that your school days were done, think again. A recent article at keepMEcurrent.com reported on the popularity of adult education classes. Many adults return to school not because they want a specific degree but because they really and truly want to learn. As an adult student, you can take courses that interest you and you have the time to actually devote to learning the information they provide you with. For people who are nearing retirement age, the reverse mortgage is an important area of interest. Perhaps that's one reason that the article mentions that their reverse mortgage class has grown in popularity.

The great thing about adult education is that no one is forcing you to do it. You can use the education in any way that you see fit. You can meet instructors who will provide you with useful information about things like how the reverse mortgage worked for people they knew. You can get access to books and other resources that you might not have discovered on your own. If you really want to know the topic through and through, taking a class could be the best way to do that.

Question of the Day: What fears do you have about returning to school as an adult?

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MSNBC is a great resource for all different types of news and information. Like other news providers, they tend to balance out their stories with a little bit of information that's helpful to a whole diverse group of people. Last week, they published ten tips for people who fall into the niche group of considering the reverse home mortgage loan. You can read the entire article here.

What these ten tips end up telling you in summary is that you should be smart about getting a reverse mortgage loan. It's not something that you should just jump into blindly. Instead, you should assess your financial situation and the pros and cons that a reverse mortgage would have for that situation. You should make sure that you work with a trusted lender and ask your finance professional a lot of questions so that you can completely understand the loan.

This will become even more important in future years. If you opt not to get a reverse mortgage at the current time, you may find that you'll want to get one down the line. The thing is that the reverse mortgage market is changing rapidly. More loans with different terms (such as younger minimum age requirements) are being offered. As more options open up, you'll need to take even more time to review your reverse mortgage choices.

Question of the Day: Which news sources do you rely on for reverse mortgage information?

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Many people think that getting a reverse mortgage does harm to their descendants. The reason for this is primarily because there is misunderstanding about how the loan gets paid off once the borrower either sells the house or passes away. The truth of the matter is that the individual who takes out a reverse mortgage is affecting only their financial future, not that of the people who love them. But if that argument's not enough to sway you, perhaps the fact that you can actually benefit your grandchildren by getting a reverse mortgage will be more convincing.

How is this possible? It's due to an announcement made last week about a partnership between a reverse mortgage lender and a school scholarship provider. The agreement between the two parties is that anyone who signs up for a specific reverse mortgage with the lender will receive a $5000 college scholarship for their grandchild. Now that's a win-win situation.

Of course, before you get any reverse mortgage loan, you'll want to make sure it's the right choice for you. You should work with a financial planner to assess whether or not you need the loan and whether the lender is right for you. You might find that you're better off refinancing your home and putting $5000 in the bank for your grandchild yourself. But it's good to see that partnerships like these are beginning to take place. They indicate that there are only more benefits to come for people who make use of the reverse mortgage loan.

Question of the Day: Would the scholarship bonus have the power to sway you if you were on the fence about getting a reverse home mortgage?

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If something tragic happens to you and you become disabled prior to retirement age, what are you going to do for income? Most people are forced to rely on a combination of social security payments and their wits to make sure that they have the money that they need after they can no longer work. One method of doing that might be through accessing home equity via the reverse home mortgage loan. Whether or not this is a good choice depends on your specific financial situation including the other options that you have for income.

Becoming disabled and therefore unable to work is difficult on a number of different levels. We'll leave the emotional ones to the psychologists who can help you. But the financial ones should be handled by a finance professional. Your future is now filled not only with your usual bills but also with your medical bills and your source of income has been significantly decreased. You need to work with someone who can put that into financial perspective for you so that you can make the right decision about how to move forward with the rest of your life.

If you have become disabled near the age of retirement, you may be old enough to qualify for a reverse home mortgage loan. However, you are probably still fairly young and have a number of years left to live. You should assess whether the reverse home mortgage is going to provide you with the income that you need throughout the rest of your life. You may find that accessing that money now is going to deplete your future resources and isn't the best choice. Or you may find that the reverse home mortgage makes more sense than the other options you have at this time. Working with a finance professional can help you make that determination.

Question of the Day: What other sources of income would you have if you were put into this situation?

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A recent decision made by the Senate helps improve reverse mortgage lending for the benefit of consumers. Prior to this decision, federal insurance programs have been limited in the number of reverse mortgages that they are allowed to underwrite. The decision eliminates this maximum cap on underwriting which means that additional programs can be made available.

The push for the decision came from two members of the Senate Banking Committe who recognized the value of the reverse mortgage for many seniors. Richard Shelby and Christopher Dodd both believe that the previous limits hindered seniors from obtaining the reverse mortgages that could assist them in funding their lives as they get older.

The decision is supported by a wide range of individuals and groups. This support comes from mortgage lenders, financial planners, senior citizen advisors, the National Association of Realtors and the National Association of Home Builders. And, of course, people who are interested in obtaining reverse mortgages also have significant reason to support the decision.

Question of the Day: What do you think is behind the motivation for the Senate to support this action?

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A number of different major financial institutions are expanding their offering of reverse mortgage loans to borrowers across the nation. This is recognized to be symbolic of the fact that a growing number of people across the United States are interested in taking advantage of the reverse home mortgage loan for leveraging home equity to finance their lives. This growth is seen in the expansion of the service by existing banks as well as by new developments in offering the loans by banks that previously didn't do so.

One example of how this growth has developed within lending institutions is the growth of the reverse mortgage lending program offered by Bank of America. The bank decided to start offering reverse mortgage loans after acquiring Reverse Mortgage of America back in May of this year. Last month, they announced that they were expanding the locations in which they offered reverse mortgages to include the Southeastern states. Recently they have also made expansions on the west coast by offering reverse mortgage loans to San Francisco Bay Area residents.

This development is just one example of a major lender growing its business through offering reverse mortgage loans. It reflects a bigger trend in the industry. And this trend could mean good things for consumers interested in taking advantage of the reverse mortgage loan. When more banks offer more products in this area, the likelihood of finding a loan that suits the borrower's specific needs is increased. Additional growth can be expected and changes to the reverse mortgage market are likely to follow. Work with a financial planner to choose the lending institution that is right for you.

Question of the Day: Which state do you think has the most people interested in reverse mortgage loans?

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A recent article published by Bend Weekly offered some good advice to reverse mortgage borrowers: shop around. The article points out what you've heard here again and again: the reverse mortgage market is changing. With that change comes increased options for borrowers. And that means that you should take the time to compare different reverse mortgage loans before selecting the one that is right for you.

The article reminds us that there have long been three different reverse mortgage loans that most people consider when they start looking at their loan options. However, they also point out that the number of lenders and types of loans has increased significantly in recent years due to the increased interest in them.

"For years there have been three primary reverse mortgage plans available - Federal Housing Administration's Home Equity Conversion Mortgage (HECM), Fannie Mae's Home Keeper plan, and the Financial Freedom Cash Account. The plan's concept has become more popular in recent months and years with senior homeowners. This has motivated many of the nation's large banks and mortgage lenders to start offering reverse mortgage products."

Since there are now additional lenders and changes to the existing loans, it is important to make sure that you understand the terms of your reverse mortgage loan before agreeing to it. This can prevent regret down the line which sometimes happens for people who don't do their research in advance. The best way to avoid this kind of regret is to work with a financial planner who can assist you in weighing all of your loan options and making the right choice.

Question of the Day: Do you know someone who has suffered reverse mortgage loan regret?

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When the real estate market is bad, you shouldn't try to sell your home. That sounds like obvious advice but it's something that many seniors forget as they start looking at the discrepancy between their monthly bills and their retirement income. As they panic at the thought of their depleting savings, they can sometimes be inclined to sell their homes even though doing so means taking a loss on the value of their homes.

FederalTimes.com recently put out an article about this issue which is worth taking a look at if you're facing the prospect of selling your home because of the financial crunch that retirement has placed on you. Among the good tips offered by the article is the importance of working with a "senior real estate specialist" who is trained in dealing with the unique home sale concerns affecting retirees. Likewise, you should consider working with a financial planner to cover all of your options for income.

The real estate market isn't good right now. But a market that is doing well is the reverse home mortgage loan market. Seniors who are considering selling their homes because they can't afford to live in them might find that the reverse mortgage makes more sense. The reverse mortgage can give them a source of income while allowing them to keep their homes. In a time when selling your home doesn't make financial sense, other options such as this should be taken into consideration.

Question of the Day: What real estate concerns do you have in the face of retirement planning?

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In a recent article titled "Individual Economic Relief", author Jesse Ragan asked five different questions about the reverse home mortgage. Those questions are all answered with a simple "no" and that no bodes well for people who are interested in obtaining a reverse home mortgage loan.

The five questions asked by the author about reverse home mortgage loans were:

1) Does the reverse home mortgage loan mean that I'll lose my home?

2) Will social security income be affected by the income obtained from the reverse mortgage?

3) Will income obtained from a reverse home mortgage affect my qualifications for senior medical insurance?

4) Does taking out a reverse home mortgage mean that I'll have nothing left to leave to my children in my will?

5) Is it a problem that I still owe money on my home mortgage?

As you can see, each of these five questions reflects a serious concern that someone might have about taking out a reverse mortgage loan. The fact that the answer to each of these questions is "no" should ease the worries of many people who don't quite understand how the reverse mortgage works but who are interested in considering one. Of course, the answer isn't always a clear-cut "no". In some cases, it's more like, "not necessarily". Speaking with a finance expert to get your specific questions answered.

Question of the Day: Do you feel better about the reverse mortgage loan after reading that the answer to the above questions is "no"?

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Are you a senior citizen in Florida who is looking for something to do this week? If so, you might consider taking a reverse mortgage class. That's one of the recommendations by the Orlando Sentinel in its laundry list of "things to do" that it provided to its community members. This is yet another example of how important the reverse mortgage is to everyday life in modern society. And it's also a neat suggestion for something different that you might check out if you're older, bored and trying to find some informative action.

The "things to do" list provided by the newspaper looks much like that which you would find in any community. It lists car shows and Christmas dances that are suitable for the whole family as well as activities for singles and seniors. Seniors are given options to stay active with information about local tai chi classes. They're also given information about classes in new technology to keep them on their toes. Along with these events and bridge games, seniors are reminded that there's a reverse mortgage program being offered in the area.

Reverse mortgages are something that a growing number of seniors are interested in finding out more about. While it's recommended that you work with a financial planner to determine the right loan for your needs, it doesn't hurt to get community information about what the reverse mortgage loan is all about. The fact that it's recommended as something for all seniors to consider checking out just points to the prevalence of interest in learning more about these loans.

Question of the Day: Would you attend a community class to learn more about reverse mortgage loans?

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You know that the reverse mortgage home loan can be used to allow seniors to remain in their homes after retirement. You also know that the reverse mortgage loan is frequently used to remodel the home as the senior gets older. But did you ever think about the ways in which those two facts go hand-in-hand?

The Morning Call recently reported on the case of a couple in Delaware who got a reverse mortgage loan in order to elevate their home to protect themselves from flooding. This allowed them to continue to live in their home after retirement despite the fact that they needed a significant amount of money to make the important renovations.

The couple covered in the story had experienced flood damages to their home on two separate occasions. The first time was in 2005. After the damage was done, the couple looked into moving to a drier location but found that there was no home that they liked more than the one they already lived in. They took their chances but experienced more flood damage in 2006. It was then that they realized they either had to elevate their home or move elsewhere.

Elevation of an existing structure is no cheap renovation. After exploring all of their options (perhaps with the assistance of a good financial planner), the couple was able to determine that the reverse home mortgage was the way to go. The money from the reverse mortgage loan allowed them to elevate the home to keep it safe from future flood damage. This renovation lets them remain in their home after retirement.

Question of the Day: Would you guess that more people get reverse mortgage loans so they can afford to remain in their homes or so that they can renovate the property?

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It seems like whenever a good thing comes along, someone bad twists it around and makes trouble out of it. For example, paying your bills online makes your life easier until someone hacks your computer and steals your identity. This same type of problem has come to plague the reverse mortgage loan industry. The reverse mortgage loan can be a terrific way for seniors to access additional spending money but 'bad guys' (predatory reverse mortgage lenders) are causing trouble in the industry.

The Miami Herald recently reported on the problem of predatory lenders. They point out that as more and more seniors have become interested in reverse mortgage loans, more "unscrupulous" lenders have come into the marketplace to take advantage of these seniors. This creates risks for borrowers interested in making use of the reverse mortgage loan in a positive way.

Two solutions to this problem are mentioned in the reverse mortgage warning article. The first is the recommendation that loan counseling be improved to allow seniors to discriminate better between good and bad reverse mortgage lenders. The second is the recommendation that government regulation of reverse mortgage loans be tightened in order to reduce the number of predatory lenders that are out there taking advantage of seniors who could benefit from a good reverse mortgage loan.

In order to reduce your own risk when applying for a reverse mortgage loan, you'll want to make sure that you're working with a credible lender. Seek out advice from a finance professional to assist you in selecting the right loan for your particular financial situation.

Question of the Day: Why do you think it is that predatory people always seem to enter markets and "screw up a good thing"?

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Back in 1961, it was determined necessary to establish the Senate Special Committee on Aging to help protect the rights of seniors in this country. The committee was originally intended to be temporary but it filled an important need in our society and became permanent 16 years later. Through that time, the committe has been active in areas including the investigation of senior fraud and recommendations for improvements in nursing homes.

An area of strong interest these days for the Senate Special Committee on Aging is the reverse home mortgage. This committee is reviewing the acts of different lenders and legislation related to reverse mortgage loans in order to make sure that what seniors need in this area is available to them without fraud or unnecessary risks.

For example, the committee recently heard testimony regarding concerns by some seniors that a particulr reverse mortgage lender was engaged in fraudulent acts. These are the types of issues that the committee takes a look at in order to make recommendations to Congress about legislation and oversight of senior issues.

There are many different issues that affect seniors in society today. As the baby boomer generation ages, it is becoming even more important that the committee attend specifically to the needs that are of greatest concern to this group. The importance of reverse mortgage loans makes this area one of the ones that the committee is likely to continue reviewing in the years to come.

Question of the Day: Which reverse mortgage issues do you believe are most important for the committee to consider in the upcoming year?

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Chances are that you know a senior citizen who has gotten a reverse mortgage recently. That's because the number of people qualifying for reverse mortgages keeps going up as the baby boomer generation gets up there in years. And the number of people interested in taking advantage of the opportunity to use a reverse mortgage is going up as well. So you know someone that falls into this category. What did you get him or her for the holidays?

If you haven't yet purchased something for the person that you know, here are some Christmas gift ideas that you might want to consider as you wrap up your shopping this weekend:

- Home decorations. The reverse mortgage loan allows the senior to stay in his or her home after retirement. You can help spruce up that old home a bit with some nice decorations for the kitchen, living room or bathroom.

- Stocks. The reverse mortgage senior is often someone who is looking for ways to increase income. You can buy some stocks in his/her name and maybe you'll get lucky enough to help out with that income.

- Piggy bank. If you know someone that's just an acquaintance and you're only looking to get a small gift, the piggy bank is a perfect one. It reminds the senior that he was remembered this holiday season, doesn't take up much room and helps him with saving throughout the year.

- Social networking account. This won't even cost you any money but it can be a great gift for the reverse mortgage senior. Seniors may be hesitant to get set up on online social networking sites because they aren't familiar with the relatively new technology. However, these sites can be great for getting questions about elderly finance answered. Learn more here.

- Maid service or in-home help. The senior who takes out a reverse mortgage loan may find that the responsibilities of the home are too much to handle. A weekly maid service or monthly landscaping can be a great gift for this person.

If you know a senior who hasn't yet gotten a reverse mortgage but might qualify, consider getting him or her information about the reverse home mortgage. Books about the reverse mortgage loan or an appointment with a financial planner can be great gifts that will benefit the senior in the year(s) to come.

Question of the Day: Which of these gifts are you most likely to get someone in your life?

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Did you take out a reverse home mortgage loan this year? If so, you probably worked with a financial planner to assist you in determining which loan was right for you and how the money from the loan should be budgeted. Even if you only reviewed loans and didn't get one yet, your financial planner likely played an important role in assisting you with understanding your options. So, did you remember to send him a Christmas card?

If you forgot about your financial planner this holiday season, it's not too late to do something nice for him. After all, Christmas may be tomorrow but the spirit of the holiday season will continue on in the days to come. Of course, you shouldn't go out and spend a bunch of money on a gift for your financial planner. He'd be the first to tell you that's a bad course of action! But here are a few small things that you can do to let your financial planner know that he/she was thought of this holiday season:

- Give him a call. Pick up the phone and call the office right now to wish him a Merry Christmas. He's probably used to dealing mostly with hassles on the phone and would likely brighten up at the experience of a pleasant phone voice on the other end of his line. He's counting down the minutes until he's home for the holidays so make a couple of them go a little bit faster.

- Recycle something money-related that you have around. You probably have a money clip or a piggy bank somewhere in your home that's not being used. If it's in good shape, it can be repackaged into a nice gift. The piggy bank can sit on the planner's desk at the office and remind people about the importance of saving.

- Write a letter of appreciation. Get some nice holiday stationary and pen out your thoughts as to why you remembered your financial planner this year, even if you were a little late in doing it!

Christmas is about recognizing all of the people in your life that have helped you out. Your reverse mortgage probably made life a whole lot easier for you and it wouldn't have gone so smoothly if your financial planner hadn't been around. Make sure that he knows that you know how important he's been to you this year!

Question of the Day: Did your reverse mortgage loan free up some Christmas spending money for you this year?

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Merry Christmas!

Hopefully your home is filled with the love and cheer of friends and family. Many people who took out a reverse home mortgage did so in order to be able to stay in their homes even after their income dropped as a result of retirement. This reflects the importance of the home to people with reverse mortgage loans so hopefully you've invited everyone to come enjoy that home with you this holiday season.

But when the gifts are all given and the family is on the way back out the door, you might want to stop and think about what you've given to the community around you lately. Part of Christmas is about recognizing those in the area who are in need of our love and assistance. For that reason, many people remember at Christmastime that it's important to give to charities when we can.

It's likely that you haven't had a lot of chance to give to charity in recent years because you were dealing with your own financial crunch. But if you've taken out a reverse home mortgage, you might find that you have a few more dollars than you did just a short time ago. Could you put those dollars to good use by giving them to a charity this holiday season?

Monetary gifts to charities don't need to be big; a few dollars here and there goes a long way towards supporting good causes. When the house is all quiet again, take some time to find a charity that could use your assistance. You can search for one here. And then give a little of that money that you worked so hard to get. The world will be better for it.

Question of the Day: What type of charity would you consider giving to this year?

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The reverse mortgage can be a terrific way for seniors to access the income that they need to remain in their homes even after they see an income cut because of their retirement. However, there are risks associated with taking out a reverse mortgage. The senior must be aware of these risks in order to make sure that no problems occur with the loan. In the event that the senior is incapable of truly understanding how to benefit from a reverse mortgage, a caregiver or adult child should take it upon themselves to assist the senior in making use of the mortgage.

A news report available online recently highlighted the importance of this issue. It tells the story of a woman who took out an exorbitant amount of money from a reverse mortgage loan and then spent it rather quickly. This created a significant debt situation which put her home on the real estate market. When her kids found out and investigated the situation, they discovered that their mother was suffering from dementia and didn't really understand the financial ramifications of what was going on. The family ultimately resolved the problem when one of the kids bought the home but it obviously placed a burden on them during the coping of the situation.

Families are frequently warned to watch out for the reverse mortgage. However, there's a lot of hype about this that doesn't translate to the facts. The fact of the matter is that if an individual works with a financial planner and budgets the loan money, it should last a lifetime. The problems arise when individuals don't really understand what they're doing when they take out a reverse mortgage. And that can rapidly became an exacerbated problem in adults with mental health issues.

Question of the Day: How often do you check in on your aging parents' finances?

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Christmas is over. The tree is coming down soon. The houseguests have all gone home. And although the holidays were wonderful, you're starting to suffer that buyers's remorse that kicks in after the season comes to a close.

Sure you loved the looks of surprises on the faces of children and grandchildren as they opened their gifts. But when the credit card bill comes, you start to wonder if you really needed to buy the latest toys and gadgets for everyone in the family. More importantly, you're wondering how you're going to pay off those bills before it's time to do it again next year.

The reverse home mortgage might be a way to get you out of that debt. There are several different options available to you in terms of how to accept payments from a reverse mortgage loan. If your credit card debt is small, you can use monthly payments to pay it off quickly and then have some spending money down the line. If you really went all out and racked up some debt, a larger lump sum payment could pay it off and get you out from under those high interest rates.

The truth is that you know that those gadgets aren't necessary. But you also know that the role of grandma or great-uncle is to get those things that parents know aren't necessary to give as gifts. And you want to be able to fulfill that role. You just need to figure out smart ways to pay off the debt so it doesn't become a problem.

Question of the Day: How much was your annual Christmas debt this year?

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You've been making New Year's Resolutions all of your life. You've probably even kept a few of them. But as you get older, it can sometimes be difficult to pin down exactly what changes you still want to make. That's not because there aren't things left that you want to do better. In fact, it's quite the opposite. You have lived enough of life to know that there are always ways you can improve on every area of living. Narrowing down which goals you want to achieve is the difficult task.

If you're a senior who has obtained a reverse mortgage loan or one who is thinking about how the reverse home mortgage might work for you, you might want to focus this year's New Year's Resolutions around goals related to finance and the home. These goals will help you make the most out of the decisions that you are making for your future.

Here are some examples of 2008 New Year's Resolutions for the reverse mortgage senior:

- Make an appointment with a financial planner.
- Consider adding to your income by coming out of retirement and taking on a part-time job.
- Invest some of the money from your reverse mortgage so that the funds can grow.
- Create a budget for wise spending of the money that you have obtained from your loan.
- Redecorate or renovate the home that your reverse mortgage has let you keep.

These are just some of the New Year's goals that you might set forth for 2008.

Question of the Day: What other goals are good ones for the reverse mortgage senior to consider this year?

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2007 was filled with many different changes in reverse mortgages and lots of news about how they're working out for the people who have obtained them. Before we kick off 2008, let's take a minute to look back on some of that news and see what we've learned so far this year:

- We learned that many retirees can't sleep at night because of concerns about how they're going to pay for their housing. We've also seen how the reverse mortgage can be a solution to that problem, allowing people to remain in their homes after retirement and even to renovate it to protect themselves from natural disasters.

- In more frivolous news, we learned that people would prefer to get financial planning advice from Oprah Winfrey than from Donald Trump.

- The most important news for consumers in 2007 has been the news about reverse mortgage scams and predatory lenders. Most important is the news available about how to protect yourself from these problems. Also important to note is that the Senate Committee on Aging has taken it upon themselves to review this issue to protect consumers.

There is a lot going on with reverse mortgages these days. Starting tomorrow, we'll see 2008 news start making headlines!

Question of the Day: What type of reverse mortgage news do you want to see more of in 2008?

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