Reverse Mortgage News

There is an article available from Alexandria Echo Press which offers eight great tips for making sure that you remain safe when getting a reverse mortgage loan. It is important for anyone who is interested in reverse mortgages to bone up on this type of information in order to reduce the problems that are associated with bad reverse mortgage loans and/or lack of education about the reverse home mortgage.

The eight tips boil down to just a few basic common sense things that you should remember when you are getting a reverse mortgage loan. The first thing that is important is that you take the time ro carefully review reverse mortgages in order to make sure that you understand the pros and cons. The second is that you should always review all of your options and weigh them against the reverse mortgage in order to make sure that you're making the right decision. And the third is to be aware of reverse mortgage warning signs like aggressive marketing and fear-based advertising.

Question of the Day: Where else should you go to get information about good reverse mortgage lending?

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President Bush has declared that it's okay to start being optimistic about the housing market in Arkansas, a sign that things could be getting better for people across the nation in terms of the current mortgage and real estate issues facing the country. This is due in part to the fact that lenders in Arkansas and other states are working on providing good counseling to borrowers (such as reverse mortgage counseling) to make sure that they don't get themselves into trouble with loans that they don't understand or can't repay.

Bush "took part in a meeting with credit counselors and homeowners in North Little Rock, offering a bright outlook on America's housing future as the Senate considers a $300 billion plan to help those faced with losing their homes." (source)

The fact that the government is working hard to remedy the problems with housing in this nation bodes well for the future of real estate. Reverse mortgage lending has been an area of particular attention by the government because of the concern that seniors were becoming victims of predatory lending. This extra attention to the reverse home mortgage has already helped to make it a safer loan and should get even better in the months to come.

Question of the Day: Is it true that we can start to be more optimistic about mortgages and real estate now?

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A recent article about seniors and their finances discussed several different methods of dealing with financial problems that are all considered to be "last resort" options. The reverse mortgage loan made the list of things that you should only consider if you're desperate for money. But is the reverse mortgage really just a "last resort" or can it be a wise financial choice even for those seniors who aren't desperate for money?

The information provided in the article about the reverse mortgage loan doesn't necessarily indicate that it has to be a last resort. Instead, it is presented as an option that should be carefully thought through. It is certainly true that the reverse mortgage loan is not right for everyone and it is also true that some people will find that the drawbacks of the reverse mortgage loan outweigh the benefits in their case.

The reverse mortgage loan is one of a variety of financial tools that the individual has at his or her disposal. This doesn't mean that it should be a back burner choice for people in dire straits with their finances. Instead, it should be one of the tools in the toolbox that gets used when it is needed.

Question of the Day: Should the reverse mortgage home loan be considered only as a last resort to saving yourself from financial trouble?

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There was a recent news article published online that discussed the five top threats to comfortable retirement and the things that seniors can do to lessen the damage of those threats. One of the five threats was the declining value of the home which impacts seniors who may have planned on using a reverse mortgage to assist them in funding their retirement.

The problem is that home equity for the reverse mortgage is based in part on the current value of the home. With home values declining, seniors may find that they have less money available to them than they had expected to have in the form of home equity through the reverse home mortgage loan.

The advice that is given to combat this is to try to remain in the home and utilize other sources of income until home values rise again. It is also noted that people who have owned their homes for at least a decade may find that they still have sufficient home equity to not have to worry much about this particular problem.

Question of the Day: How do declining home prices impact the ability of the reverse home mortgage to aid seniors in retirement?

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It is no secret that the mortgage industry has taken a hard hit over the last couple of years. It is also fairly widely known that one of the few areas of mortgage lending that has thrived in spite of this decline is the reverse home mortgage loan industry. Businesses that are struggling to stay alive are increasingly trying to rebuild their mortgage companies with focus on the reverse mortgage loan. IndyMac is one of the major mortgage lenders who is doing just that.

IndyMac is a major mortgage lender that has had trouble staying afloat in these trouble times. The company has recently announced that it's stopped taking all new loan applications while trying to get back on its feet since there is just no way that it can continue to offer loans without any serious profits rolling in. Additionally, the company is trying to cut costs by laying off a significant percentage of the staff that works there.

Where IndyMac hopes to be able to rebuild this business is in the area of reverse mortgage loans which have done well across the nation despite a general decline in the stability of mortgage lending. If the business can manage to sustain itself through these tough times using the reverse home mortgage loan then it might be able to grow again in the future after the real estate and mortgage markets improve.

Question of the Day: How will a focus on reverse mortgage lending assist IndyMac to remain in business?

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If you decided that you were interested in getting a reverse mortgage loan, who would you turn to for assistance with that loan? The majority of people go first to the bank where they got their first mortgage loan. A few will turn to a senior citizen financial advisor to get advice about the best place to go to get a good reverse mortgage. But a new option has just opened up which may provide a third party place to go to get a reverse mortgage loan - your insurance agent.

A new program called Wealthbridge has just opened up which offers various types of home loans, including the reverse mortgage loan, to individuals who first contact their insurance agents. The individual can call their health or life insurance agent to discuss the loan and will then be put in contact withe the Wealthbridge representative who can assist them with the details of the loan.

This option is appealing to some seniors because of the fact that they may have a long-term relationship with their insurance agent and may be more trusting of this person than they are of the people at their bank. The insurance agent will work with the individual to transition into the reverse mortgage loan with the appropriate professionals for that job. This adds a new level of security to the reverse mortgage loan and may improve mortgage lending practices for seniors.

Question of the Day: Would you contact your health or life insurance agent for help with a reverse mortgage loan?

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There is currently a huge debate raging in the reverse mortgage and financial lending communities. The debate is about whether or not the reverse mortgage loan should be allowed to be tied to other financial products that are offered to seniors

Some people say that there should be allowed some tying together of the products that are offered to seniors for financial issues. Some people say that other financial products should be available from the same lender but should not be marketed aggressively towards the reverse mortgage consumer. And still others say that reverse mortgage lending should be done at separate financial institutions so that there is no confusion for the senior about other products offered when getting a reverse mortgage loan.

Basically, people who sell products like life insurance want to be able to cross-sell this with the reverse mortgage without interference from the industry. However, people with concerns about senior's rights want to make sure that the reverse mortgage borrower isn't being pressured into the purchase of other types of financial products that actually put them into more debt. The debate is about how to balance these two concerns.

Learn more here.

Question of the Day: Should reverse mortgages be allowed to be tied to other financial products like life insurance?

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Earlier this week we reported on the fact that major lender IndyMac is facing some serious problems with remaining in business. The company has high hopes that it can focus on its successful reverse mortgage business in order to remain afloat in the industry despite these troubled times. However, this doesn't mean that those people with existing IndyMac reverse mortgage loans should assume that everything is okay as is.

Basically, there is a good chance that IndyMac isn't going to be able to ride out the financial problems that are plaguing the company. If they fail to do so, they will have to sell their existing loans to another bank. This means that anyone with an outstanding reverse mortgage loan from IndyMac will have a new lender.

Of course, this shouldn't cause panic for those people who are receiving reverse mortgage checks from IndyMac. Those people who have government-insured HECM loans should know that these loans are backed by the FHA and will continue to be paid out without problems no matter what happens with IndyMac. But it's still important to always be on top of the news about your loans so it's a good idea for those people with IndyMac Reverse Mortgages to start asking some questions about what's going on with their loans.

Question of the Day: Should seniors who have IndyMac reverse mortgage loans be concerned about the financial problems plaguing the company?

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Many people are highly concerned about the state of banks and lending today. This is due in no small part to the troubles being faced by IndyMac. However, not all banks are suffering despite the problems they're dealing with in the industry.

One example of a bank that has managed to turn great profits despite these troubled times is EverBank. The bank has chosen to focus on low-risk investments and lending in order to continue making a profit in spite of the fact that there are many banks that are nearing bankruptcy. The efforts have been successful as EverBank reports ongoing profits.

One of the things that drove profits in recent months was the fact that EverBank opted to sell of its share of a Reverse Mortgage business. Reverse mortgage lending is considered to be less risky than other mortgage lending and has even been cited as one area of business that IndyMac hoped could keep it strong. However, EverBank's sale of the business may have helped secure profits that couldn't otherwise have been obtained.

Question of the Day: Are mortgage lenders facing serious problems or simply riding out rough waters?

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The nation is facing financial trouble and everyone has to figure out what to do about it. The people who are most greatly impacted by the rising costs of everything from fuel to milk are those people who are living on a fixed income. In other words, the nation's seniors are suffering because of rising costs that aren't offset by a rise in income.

The reverse mortgage is one obvious solution for seniors who are trying to figure out how to deal with this issue. One report indicates that reverse mortgage lending may have already doubled since last year - and we're only halfway through 2008!

Seniors are opting to think about the future, pay off bills immediately and try to change their habits in order to reduce spending. The reverse mortgage can assist them in paying off those bills and planning for the future without requiring them to make drastic changes to their situation today. This makes it a good solution for a growing number of people.

Question of the Day: How much will reverse mortgage lending have increased at the end of 2008 as compared to 2007?

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In a recent article discussing the possibility of using a reverse mortgage to help fund life in these economically difficult times, it was stated that the most important thing that you can do when considering getting a reverse home mortgage loan is to make sure to speak to a financial counselor prior to making any decisions. This is wise advice.

There are many different things that you will need to do when you get a reverse mortgage loan. You will need to work with a lender. You will need to budget the money that you get. But all of these things are made easier when you have worked with a reverse mortgage counselor who is capable of explaining all of the details of the loan to you.

In fact, getting reverse mortgage counseling is a prerequisite to being allowed to get the loan. However, you shouldn't necessarily go with the reverse mortgage counselor recommended by a lender. Instead, you should seek out your own highly-qualified financial advisor to assist you in making immediate and long-term decisions about how to maximize use of the reverse mortgage loan.

Question of the Day: What are the most important things to consider when getting a reverse mortgage loan?

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The reverse home mortgage is a hot topic of discussion right now for all different sorts of people. Of course, the reverse mortgage is something primarily discussed by seniors who are suffering from financial concerns but they aren't the only ones talking about reverse mortgages.

Here's a look at the most common reasons that reverse mortgages are a hot topic of conversation right now:

- The economy is changing. People everywhere are worried about their financial situations and they are considering all of the different options that they have now and will have in the future. The reverse mortgage is one of those options.

- The baby boomer generation is getting older. These people now are starting to qualify for the reverse mortgage loan and therefore there is a big group of people seeking information about this topic.

- There are more and more reverse mortgage alternatives. Programs that are similar to the reverse mortgage but without the limitations - such as the age restrictions - are opening up and allowing a broader audience to be interested in discussing the reverse mortgage.

People of all ages are becoming more aware of the reverse mortgage as one option for financing their lives. As they do, they are starting to talk more and more about this option.

Question of the Day: What are the biggest reasons that people right now are interested in reverse mortgages?

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It has always been difficult for people to budget for their retirement. That's why so many seniors have relied on the assistance of a financial advisor to help them make the transition into retirement in a way that creates some financial stability. Unfortunately, even with the help of a financial advisor, it is increasingly difficult to make solid plans for a retirement budget in today's changing economic world.

"It's hard enough under normal circumstances to figure out how much is needed to ensure a comfortable retirement. But the mix of slumping housing prices, oil at around $140 a barrel, and volatile financial markets makes it particularly tough today." (source)

The fact that these changes are taking place also makes it more difficult for seniors to budget their reverse mortgage income appropriately. The good news is that you have a set amount that you can receive from the reverse mortgage so you do know what kind of money you're working with. However, it's difficult to lay out specific plans about how to spend it because of the fact that the financial future is so unsure.

Question of the Day: Is it more difficult to budget a reverse mortgage income now that the economy is in flux?

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Many people have been eyeing the way that the reverse mortgage market has been affected by changes in the economy. For the most part, the reverse mortgage market has remained steady. Seniors living on a fixed income need money now more than ever before so they are turning to reverse mortgages even as other mortgages have become less and less easy to obtain.

However, it should be noted that there are some changes taking place regarding the terms of reverse mortgages because of the fact that home values are changing. People who applied for reverse mortgages in the past don't have to worry about this issue but those people who are applying for them now need to be aware of the fact that they may not be able to access the same amount of home equity that they could have a few years ago because the value of their homes has gone down.

What is important to note is that the fees for obtaining a reverse mortgage have not declined in the same manner that the monthly income potential for the home has. One of the biggest drawbacks of reverse mortgages is that they come with high fees for taking out the loan. Most borrowers don't pay attention to these fees because they are worked into the loan and don't require actual out-of-pocket payment. However, they take away from the total amount that can be gained from home equity so it's a problem if fees stay high but value of the home declines.

Question of the Day: What can be done to lower reverse mortgage fees as home values decline?

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There is a profile of Fidelity Reverse Mortgage available online this week which reflects a few important trends in the reverse mortgage business. It discusses the fact that the company has started recruiting reverse mortgage specialists online through a series of informative webinars and other modern tech tools.

The first trend this reflects is a general trend towards recruiting of reverse mortgage specialists. The reverse mortgage market continues on the rise and therefore businesses are in need of specialists who can service clients seeking out reverse mortgage information. There is more demand than supply in this business and therefore reverse mortgage banks are recruiting heavily.

The second trend is the trend towards online business. This is fine when recruiting for positions of all kinds. However, the reverse mortgage market is a tricky market which has the potential for very aggressive marketing practices so it is important for banks recruiting in this way to make extra sure that they aren't making poor hiring choices. They should also take care not to extend their aggressive online recruiting to customers but to keep it instead at the business / career level.

Question of the Day: Should reverse mortgage banks be recruiting online?

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There is a report published by Kiplinger this week that warns seniors that reverse mortgage abuse is on the rise. The issues that are raised in the report are very important issues which should be of concern to seniors who are considering getting a reverse mortgage loan. However, it is not necessarily accurate to say that predatory lending practices are actually increasing at the current time.

Reverse mortgage abuse is definitely an issue that should be focused on by people who are working with seniors. There are predatory lenders out there who market aggressively to get seniors to obtain a reverse mortgage loan which may not be right for them. The suggestion of the article is that the rise in the number of mortgage companies offering these loans combined with the rise in the number of people approaching the age when a reverse mortgage can be obtained leaves the door open for additional predatory lending practices to take place.

It is true that the door may be opened but it should be noted that there are people guarding that door carefully to make sure that reverse mortgage loans are safe for seniors. The FBI has cracked down on aggresive reverse mortgage marketing and reverse mortgage fraud in recent months. Additionally, reverse mortgage counseling has been improved and state legislators have passed laws to protect these borrowers. While it remains important to be aware of these reverse mortgage issues, it is not necessarily a time for panic in the industry.

Question of the Day: Is reverse mortgage abuse on the rise?

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There is a program in Imperial Beach, California which may reduce the need for some seniors to get a reverse mortgage loan. The most common reason that seniors get a reverse home mortgage is because they need the money to be able to stay in their homes. Their homes may also be in need of repairs which can't be afforded on the senior's fixed income. The new plan kills two birds with one stone by offering money to home owners who are willing to make energy-efficient changes to their homes but requiring them to remain in the home for at least fifteen years after the money has been provided.

Seniors who want to make improvements to their home can benefit from this not only because this is debt-free money for those improvements but also because energy-saving and water-saving home improvements also cause the home to cost less to the home owner in terms of ongoing bills. This is particularly great for seniors living on a fixed income.

The senior is going to benefit from this only if he or she planned to remain in the home for a long period of time anyway. Since the majority of people seeking out reverse mortgage loans are people who plan to stay in their homes, this shouldn't be a serious problem. This could be one beneficial alternative for seniors living in Southern California.

Question of the Day: Should more cities make incentive plans like this to replace the need for so many reverse mortgages?

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A new housing bill is likely to be signed by the president within the next few days and many say that it's a great bill that has "something for everyone". This includes changes to reverse mortgages that are designed to be beneficial to the seniors who are interested in getting these loans.

There are three major changes to reverse mortgages included in this bill:

1. Reduction in the amount of fees that can be charged. Reverse mortgage loans are notorious for their high fees. This new bill addresses that problem and makes the reverse home mortgage loan more fair to the borrower.

2. Rules about not tying reverse mortgages to other loans are strengthened. Many lenders try to sell the reverse mortgage with other types of products and it is now clearly outlined that the reverse mortgage borrower doesn't need to purchase anything else to get the loan.

3. The amount allowed for borrowing has increased. This means that people with homes worth more can now borrow the full amount up to $625,500.

These changes should help to improve reverse mortgage lending assuming that the bill passes.

Question of the Day: What other laws and rules should be put into place to improve the reverse mortgage loan?

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There was an interesting report issued this week that indicates that seniors may be coming to grips with the fact that the value of their home is on the decline. The report relies on information obtained from the online reverse mortgage calculator of a senior issues website. This information reveals that seniors today are self-reporting lower home values when seeking out reverse mortgage information, a move which suggests that they understand that the value of their home isn't the same as it was last year or five years ago.

Seniors in California were most likely to report a large drop in home value - the nation's highest at nearly ten percent. This may indicate that home values in that state have declined considerably more than in other places or it may mean that seniors in California have a better understanding of the decline in home values than do people in other states.

Question of the Day: Are seniors coming to terms with the fact that home values are on the decline?

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There is a publication called The Reverse Review which provides reverse mortgage news and information to the professionals who are working in the industry. A recent article from this publication focuses on the important fact that reverse mortgage professionals must maintain a code of ethics in working with their senior clients. Doing so protects the senior borrower and also gives more security and credibility to the reverse mortgage industry.

The article points out that a number of people have entered the reverse mortgage industry specifically because it's still thriving despite the fact that other mortgage industries are failing. They encourage these people to look closely at their reasons for being in the business and to make a commitment to their senior customers to treat them ethically and fairly in spite of the fact that they are certainly in the business to turn a profit. It is through professional articles like these that the industry becomes safer and more profitable to everyone involved.

Question of the Day: What should be done to further encourage reverse mortgage professionals to maintain their ethics in working with senior clients?

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The reverse mortgage is not something that is unique to American home owners. People in various parts of the world are enjoying the same benefits (and facing the same problems) with the reverse mortgage that we are experiencing here in the United States. But the financial history of those regions may cause for a more complex situation for the borrower.

An article about reverse mortgage confusion in Australia points out:

"Half the Australian population have only known good economic times. The other half have difficulty remembering the bad ones. In the last 2 years the reverse mortgage market has doubled to $1.8 billion with more than 31,000 such mortgages in place in Australia. This is expected by the industry to grow to between $12 billion and $15 billion in 2 years." (source)

This indicates that there are a lot of people in Australia looking in to reverse mortgages but that they may not be familiar with the economic ups and downs that make these mortgages both a benefit and a drawback to the borrower.

This suggests that reverse mortgage education for seniros in Australia may have to differ somewhat from that of the education given to seniors in the United States in order to make sure that they have the financial understanding that they need to be able to use these loans without problems.

Question of the Day: Are reverse mortgage problems different in Australia than they are in the U.S.?

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There are several different types of reverse mortgage loans available to the senior borrower who is interested in obtaining this type of financial assistance. There are also reverse mortgage alternatives that may be considered instead of getting a true reverse home mortgage loan. But the majority of people who get a reverse mortgage will get a traditional reverse mortgage and they will go with the HECM reverse mortgage plan back by the U.S. HUD.

A recent article about reverse mortgages cites four reasons to go with the HECM reverse mortgage:

1. You have the option of choosing a fixed or variable interest rate.
2. You have a lot of choices about how payments are received.
3. You can use the reverse mortgage in any way that you please.
4. You get the protection of a federally-backed loan.

The truth is that you can probably obtain the first three reverse mortgage benefits from almost any reverse home mortgage loan. However, the fourth benefit is invaluable and makes it a great idea to choose these loans!

Question of the Day: What are the benefits of choosing HECM Reverse Mortgages?

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