HECM Reverse Mortgages Could Be The Answer

9/08/2009

posted by N. Sioris

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During the past year vast amounts of wealth have vanished into thin air from many retired folks' nest eggs. As a result there is a greater demand for HECM reverse mortgages . It is estimated that trillions of dollars in retirement portfolios have evaporated over the last 18 to 24 months. This is undeniably, the worst economic collapse since the Great Depression.

As a result of the stunning loses experienced by many seniors all ready in retirement and relying on fixed incomes, it has been increasingly necessary for many retirees to take a serious look at tapping into home equity through the use of HECM (home equity conversion mortgage) reverse mortgages in order to replace lost dividend and investment portfolio income.

HECM reverse mortgages are government insured loans that allow seniors age 62 and older to receive monthly income based on the amount of equity in their homes. The current financial meltdown could be the reason that government reverse mortgage production has increased nearly 20 percent over the same period last year.

For older Americans who intend to stay in their homes long-term, HECM reverse mortgages could very well be the financial vehicle they need in order to sustain their cash flow during their retirement years.


Qualification Is Easy

This can be a very attractive choice because there is no repayment required on HECM reverse mortgages as long as the seniors remain in the home as their primary residence. There are also no income or credit qualifications in order to be eligible for a government reverse mortgage.

If you or a family member would like additional information about HECM reverse mortgages, please contact us by clicking below or call our office at: 1-888-269-1098

Planning For Retirement - Has The Model Changed?

9/03/2009

posted by N. Sioris

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The foundation for a solid retirement plan has traditionally been characterized as a three-legged stool. The three legs are pensions, Social Security, and personal savings. However, recent financial trends suggest that the three-legged stool approach may becoming less reliable.

The savings rate for Americans has significantly declined sine the 1980s. It reached its lowest level since the Great Depression in 2004. Recently, however, it has been gradually trending upward. (Probably out of fear and devastating investment and asset loses.)


Exacerbating the savings shortfalls is the near elimination of defined benefit plans by corporate America. This reality leaves many Americans facing a retirement with less guaranteed income.

As the cost of living continues to rise, many retired Americans find it hard to make ends meet. To maintain their standard of living, some older homeowners are beginning to turn home equity into monthly income through a reverse mortgage home loan. This approach is gaining momentum and is just now starting to be explored by financial planners and financial advisers. It is becoming obvious that a new paradigm is emerging as a result of the greatest loss of wealth since the 1930s.

Researchers estimate that close to 78% of older households do not have sufficient assets to sustain them through retirement. Baby Boomers are also concerned about their ability to maintain their standard of living as they get older. People that expect inadequate or unreliable retirement income are more likely to plan to use a reverse mortgage home loan as a vehicle to access home equity in later life.

If you are one of those people that are stressing over how to supplement your retirement income, you may want to find out how much of your home equity might be available to you from a reverse mortgage home loan. Ask for your personalized reverse mortgage loan quote today.

When Is It A Good Time To Get A Reverse Mortgage?

7/29/2009

posted by N. Sioris

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Over the weekend I was invited to a get-together where there were people from all different age groups. Several of the older attendees knew that I work in the reverse mortgage field. One gentleman in his mid 70's pulled me aside and said, "My wife has been saying that she is nervous about what will happen financially if I pass away before she does." He went on to say that she suggested that maybe they should get a reverse mortgage. He then asked me, "Do you think she is right, should we go ahead and get a reverse mortgage, is now a good time?"


Do You Need The Money?

My first question to him was; "Do you need the money?" He said, "No, we're fine right now, but if she doesn't have my retirement income if I should pass away, she's worried that she might not be able to finish paying off the mortgage and maintain the bills." As it turns out they have less than a hundred thousand dollar mortgage balance on their home that's worth in excess of three hundred thousand. They are not strapped for monthly income and they have some other assets as well.

My short answer to him was, "No, I wouldn't get a reverse mortgage at this time." He took a step back and looked at me with a puzzled expression on his face. He obviously wanted a more in depth explanation for my answer. So we had a long chat and the bottom line is that my advice to him was that if the scenario he presented does happen, then his wife can go ahead and get a reverse mortgage at that time. By then she will be older, hence eligible for a higher loan-to-value percentage, and their loan balance will be less or possibly even non-existent.


A Light-Bulb Moment

During our conversation it became clear (once again for about the hundredth plus time) how mis-understood HECM reverse mortgages are. This charming gentleman had no idea that even though there are no mortgage payments required on HECM reverse mortgages, there is deferred interest accumulating on the loan from day one, and will be deducted from his estate or heirs inheritance when the home is sold or refinanced at the time the loan is paid back. From the look on his face as I explained how the loan is a "rising debt" loan, I could tell he was truly experiencing a light-bulb moment.

To get a reverse mortgage when you do not really need the money makes these loans a very expensive proposition. But, as I told him, "HECM reverse mortgages are expensive if you don't need the money. However, they are NOT expensive if you do need the money and you have no alternative assets."

Renewed Interest In Reverse Mortgages

2/27/2009

posted by N. Sioris

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As the economy continues to unravel on every front, more retirees are turning to Reverse Mortgages to sustain their lifestyle and provide the needed cash to weather the financial storm. Even people that thought they planned well and have diversified portfolios, are having to re-think their retirement strategies.

Many seniors really don't want to touch their investments right now, and yet many cannot wait years for those investments to recover in order to draw on them. So while retirees watch in dismay as both their home values and their investments plunge to new depths, many are turning to reverse mortgages to get through these troubled times.


HECM Reverse Mortgages - New Lending Limit - $625,500.

A ray of hope emerged earlier this week when HUD announced the immediate implementation of the new higher National loan limit for FHA insured HECM reverse mortgages. The previous loan limit was $417,000. As part of the Economic Stimulus package a TEMPORARY increase for FHA/HECM reverse mortgages for the balance of 2009, is now $625,500.

The higher reverse mortgage loan limit is particularly beneficial for people that have homes with a value higher than $417,000. With the new $625,500. lending limit they can now access a much higher amount of equity.


Virtually No Other Jumbo Reverse Mortgages Available

Additionally, since the credit crunch started last fall, virtually all of the proprietary "Jumbo" reverse mortgage products that had been offered previously have dried up. The absence of any jumbo reverse mortgage loan products, left many homeowners with high value homes, disappointed by the small loan amount offered by FHA versus their equity and home value.

If you are someone that never thought you would need a reverse mortgage before or if you have a high value home and have previously been disappointed by the loan amount offered, you may want to take a second look at this option.

Request a no obligation reverse mortgage quote today!