Reverse Mortgage Lets You Reverse Your Monthly Mortgage Payment

Homeowners have a lot of questions when it comes to reverse mortgage. One of the most common one is if they can still take out a reverse mortgage if they already have mortgage. Many people believe that the answer to this question is no. But the truth is, reverse mortgage allows its borrower to reverse their existing mortgage payment. The borrower no longer have to make monthly payments because they can use the proceeds from the reverse mortgage to end their mortgage once and for all.

Reverse mortgage loan is federally guaranteed. It is also a regulated program which means there are some restrictions. This type of loan is created to use the equity of the house, but there are restrictions to how much a reverse mortgage could produce and how much of the mortgage could be paid off. One excellent way to find out if a reverse mortgage will perform well for you is to determine if your current mortgage is below 70% of the appraised value of the house. That’s the maximum lending limit for many cases. You don’t have to worry because our reverse mortgage will give you the exact figures of how much you can borrow.

The loan proceeds you get from the reverse mortgage should go towards paying off your existing mortgage. You can use the remaining cash any way you want but only after you’ve paid off your mortgage. This must be the goal of those who wish to take out a reverse mortgage especially if they still have a large home equity loan. One advantage of a reverse mortgage is that it can remove the existing mortgage and the cash that was supposed to be used to pay off the first loan can be used for a different purpose. Another benefit is that reverse mortgage loans won’t require the borrower to make monthly repayments for as long as you live in your house.

Benefits of Reverse Mortgage

Reverse mortgage is a loan product that’s especially useful to get rid of monthly mortgage payments as well as payments for medical bills, medicine, and credit card debts. This type of loan came from Europe. It has been extremely famous financial assistance in other countries like France, Germany, and England for the past 35 years. Even though the United States has perfected the administration and safety of the loan in the past 15 years, its popularity still skyrocketed in the last ten years. It has reached a point where it is now experiencing a 200% growth from every year to the next in the number of retirees or seniors who are signing up for a reverse mortgage program.

Reverse mortgage Greenville is an affordable, safe, and free financial strategy that doesn’t affect any income or government benefits. It also protects the house from default as well as foreclosure and provides relief to seniors who have been feeling stressed over their monthly mortgage payments.

Call David Stacey if you need more information about reverse mortgage.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

• 
  

What Are Reverse Mortgages Commonly Used For?

One of the most common options for senior citizens is a reverse mortgage. Its popularity is attributable to its ability to provide the homeowner the freedom to utilize the money from the loan in whatever way they choose. Since the homeowner is going to have full control as to how he or she will use the loan’s proceeds, there are several different ways wherein these reverse mortgages can be utilized. Provided below are some of the most common purposes of reverse mortgages.

Several senior citizens are discovering themselves to be in a position wherein they need to find new methods to cover for their long-term care because of the increasing cost of healthcare. Several seniors have opted for a reverse mortgage as a strategy to fund the fees for their health care. Generally, they use the money obtained from the loan to pay the premium for their long-term care.

The cash they get from the reverse mortgage loan lets a few senior citizens get the kind of health care they need for as long as required. This is also because of the FHA insurance, which ensures homeowners continue to get monthly payments provided that they continue to reside in the house. They cash you obtain from a reverse mortgage Greenville is also tax exempt. Additionally, based on your financial status, your social security, as well as Medicare benefits, are typically not influenced by the cash you obtain from the reverse mortgage. If you want to be perfectly sure, it is highly recommended to consult a CPA. You may also consult your counselor or perhaps your reverse mortgage broker if you plan to apply for a reverse mortgage loan.

The money obtained from reverse mortgage loans can also be used to pay for emergency or unexpected medical expenses, pay for long-term care insurance costs, or monthly medical bills. A senior citizen can also use a reverse mortgage loan to turn the tables if he or she is facing a foreclosure. Rather than paying on a monthly basis, the bank will be giving the homeowner a monthly “income”.  If you obtain the mortgage, the mortgage for the foreclosure can be settled so that the property will be taken out of the foreclosure process.

A reverse mortgage can also act as a shield. Provided that you continue to live in your house, you can be assured that you will never be asked to surrender your property. All you need to do is make sure that the insurance payments and real estate premiums are up to date.

Seniors can also use the reverse mortgage loan to fund their retirement. With today’s economy, many seniors are finding it harder to keep the lifestyle that they have gotten used to especially with their increasing life expectancy. With the reverse mortgage, you can choose to get your loan in monthly installments from the bank. This can serve as their second income.

Call South Carolina Reverse Mortgage Services and find out if a reverse mortgage loan is the best option for you.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Reverse Mortgages Are Starting To Gain More Approval

Reverse mortgages have always been controversial. But, it’s starting to get more approval from financial planners as retirement crisis continue to haunt seniors. Although some planners are still sceptical, others are starting to consider home equity as a good way for their clients who have found it difficult to save or add on to their retirement income.

Reverse mortgages were once considered as the Wild West of the mortgage sector, they have observed their reputation improve as the Federal Housing Administration tightened their lending standards. More experts are now saying that reverse mortgages could be a wonderful tool for retirees.  

Gaining Acceptance

When they were first introduced, reverse mortgages got a negative publicity because of their brokers who were overly aggressive. Many of them gained a lot of commissions on loans on seniors who are not financially sophisticated.

The lowest point came after the Great Recession wherein 10% of all reverse mortgage loans fell into default.

The Federal Housing Administration is responsible for insuring reverse mortgages. It responded by tightening up the requirements for homeowners who are looking to make the most out of the Home Equity Conversion Mortgage program.

The reforms restricted the amount of home equity that a homeowner could take out during the first year to 60%, getting rid of the temptation of a sudden and single windfall.

The FHA made the credit standards tighter. Homeowners with finances weren’t up to par could be needed to put cash aside in their escrow account in order to cover their future expenses.

To qualify for a reverse mortgage loan, you have to be at least 62 years old and have significant home equity, and the ability to cover the home repair, taxes, and insurance costs.

Reverse mortgages could offer extra retirement income, which is a much more affordable replacement for long term care insurance. It will also help seniors put off spending their social security, so they could get a higher payment every month by delaying retirement.

For individuals who for some reason were unable to save enough for their retirement, tapping into their biggest home equity could be a live saver.

Together with the lump sum, other reverse mortgage options involve taking out a line of credit or receiving monthly annuity, an option that received the most approval from financial planners.

Some planners are optimistic in a reverse mortgage line of credit, which could grow as much as 3% to 4% annually.

Obviously, if you use the line of credit, the money you get will not grow anymore and will just begin to accrue interest.

However, whether it is via a reverse mortgage lump sum or credit line, it could be very helpful to get another income source to draw upon, according to some planners.

Taking out reverse mortgage loan, can greatly help. Say for example you’ve made investments, you have cash, and you have home equity, you can tap into any of them depending on the market conditions.

Call Reverse Mortgage Specialist if you would like to know more about reverse mortgage.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

What Are The Pros and Cons of Reverse Mortgage?

By now you’ve probably heard about reverse mortgages. The idea behind it is quite simple. Instead of getting a home loan and paying the lender, the lender will be the one who’ll make payments to you. Such payments could be in the form of a lump sum or a regular monthly payment. Whatever option you choose, you won’t be required to repay the mortgage until you die or decide to move out of your home.

Even if this seems like a good deal for you, the truth remains that reverse mortgage loans are controversial. Some say that this type of loan should be part of one’s retirement plan. Seniors who are in need of extra money can tap into the home equity, which will be their most valuable asset.

But critics say that reverse mortgages are associated with substantial fees and the balance on the loan increase as time goes by. Plus, reverse mortgages that were not made via an FHA program don’t have enough consumer protection, which could leave you or your estates on the hook in case the house loses value.

Before you make a decision, here are a few things you need to know about the pros and cons of reverse mortgages.

The Pros of Reverse Mortgage 

-       May receive regular income provided that you live in the house as your primary residence.

-       Payments you get from a reverse mortgage are not taxable

-       FHA reverse mortgage loans are considered as non-recourse loans and that means you cannot owe much more than the existing value of your house.

-       Payments do not need to be made on the loan until you decide to move, sell the house, or you die.

The Cons of Reverse Mortgage

-       You should be at least 62 years old to get a reverse mortgage loan via the FHA program

-       There are many costs to obtaining this kind of loan including but not limited to mortgage insurance.

-       Your estates might not be able to retain the house in case they can’t afford to repay your debt.

-       In case you can’t stay in the house because of your long-term needs then the reverse mortgage loan will become due.

-        

Always remember that even if you are not required to make repayments for your reverse mortgage Greenville, you will still be held responsible for covering other fees like the maintenance costs, homeowners insurance, and property taxes.

If you fail to meet these requirements, your house may be foreclosed on. It is crucial to make sure that you have money available to cover these expenses because if you don’t, you may run the risk of losing your home. Some lenders would set up a set aside account so you can deal with the aforementioned costs, moving a portion of the loan into the account. But this set aside account will not guarantee that you will always have the cash to cover these expenses. So be sure to pay close attention and that you are updated.

If you want to understand how reverse mortgages work, then you should call Reverse Mortgage Specialist now.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

How Are Reverse Mortgages Dealt With During The Probate Process?

A reverse mortgage lets eligible homeowners tap into their home equity to meet the borrowers’ retirement expenses. In order to qualify, you should be at least 62 years old, reside in the property as your main home, and own the house outright or you have enough equity in the house.

No monthly payments of interest or principal are due on the reverse mortgage loan. The loan will accrue interest as well as other fees that aren’t due until a trigger situation happens. But, the borrower remains responsible for homeowner insurance, property taxes, maintenance, as well as the homeowner association fees.

You have three options for loan proceeds to be given to the borrower. These are a monthly payment, a lump sum, and a home equity line of credit.

The reverse mortgage will become due when one of these trigger events happen:

1.    The property has been sold or the title to the property has been transferred.

2.    The borrower is no longer using the house as his principal residence for more than 12 months.

3.    The borrower has failed to meet the obligations of the reverse mortgage, like paying property taxes, keeping the property in great condition, and maintaining homeowner’s insurance.

In case a surviving spouse isn’t a borrower, perhaps because he or she is below 62 years old, a federal case, holds that the lender can’t foreclose against a surviving spouse who is a non borrower at the death of the borrower/spouse. But the loan will remain due as mentioned above.

In case a house with a reverse mortgage will become subject to probate, the loan remains an encumbrance on the house. Encumbrances remain with the house while it changes ownership, and will continue until it’s satisfied. The house won’t revert to the bank once the last borrower dies. When that happens, the reverse mortgage must be paid off however, all of the remaining equity will belong to the beneficiaries or heirs of the borrower as per the terms of the trust or will. Reverse mortgage borrowers who will remain in their houses for several years will accrue more charges and interest on the reverse mortgage and the remaining equity cost will rely on how much money the borrower has taken out from their mortgage as well as the existing market condition.

The beneficiaries and heirs of the borrower have to determine when they would like to keep the house or if they want to sell the house. In case they would like to keep the house they should pay off the balance of the loan with a new loan using refinancing or with other source of income that’s available. In case they go for selling the house, they have to get in touch with the servicer of the reverse mortgage loan right away and let them know about their decision and also keep good communication with that servicer. The beneficiaries/heirs have from between three to 12 months, with the approval of the lender, to sell out the property. The good thing is a reverse mortgage loan is considered a non-closure loan, which means that when the amount that is due on the loan, including fees and interest, is far greater than the amount that the property will sell for the beneficiaries/heirs aren’t liable for any extra amount owed. A sale to an eligible third party and non related group doesn’t have any limitations. But the beneficiaries/heirs can’t sell the house to a family member for an amount that’s less than the cost of the loan.

Call Reverse Mortgage Specialist if you wish to know more about reverse mortgage loans.

 

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

A Second Look at Reverse Mortgage Amid Coronavirus Pandemic

Reverse mortgage has gained the attention of many these days as a potential source of financial stability as the stock market plunge and the 401(k)s shrink away amid the coronavirus outbreak.

A part of the new appeal in this type of loan has been the rising equity that seniors have in their homes. The NRMLA or National Reverse MortgageLenders Association said that homeowners who are at least 62 years old aw their housing riches increase by $39 billion for the 3^rd quarter to the 4^th quarter of 2019, which set a record level of a whopping $7.23 trillion at by the end of the said year.

The growth is significant and it marked a 67% year to year increase for the sector. The customers of reverse mortgage loans is the older homeowner that’s in their retirement, and their retirement just battered by as much as 30%. Many borrowers asked if they should be accessing the equity in their homes rather than sell off their position or just live off their retirement with the belief that over time, it will return.

Although economic crises aren’t something new, the current situation’s scope and depth on the global scale is affecting the people hard, with several potential borrowers asking more questions about reverse mortgage loans.

Meanwhile, reverse mortgage borrower interest has risen continuously at an extremely high level and perhaps even higher since borrowers are noticing some of their other retirement assets undergo significant issues because of the decrease in the stock market. Borrowers are making use of their home equity as a source of income that they could tap into in order to fill that financial gap that is being created by the coronavirus pandemic. From the perspective of a borrower, it’s most likely because there is a growing interest at the borrower level.

Many of the borrowers of reverse mortgage loans are in the eye of this particular hurricane. They are worried about their financial health and if they still have the ability to age in place in the years to come. The deeper answer to this question is what are the actions they’re taking to edge their risks during this time when the markets are making vast movements? A lot of them are turning to reverse mortgage for safety and security.

Inquiry levels about this loan has reached new levels that lenders haven’t seen in three years. This could be attributed to a wider trend where more homeowners are considering their home equity as an option to help them get a more secure and safe retirement outcome.

An essential component in this rising consumer interest is overcoming the confusion by a lot of people about how this product work. Even though reverse mortgages have been available on the market for several years, many people are still unaware of how the loan works.

There remains a lot of misconceptions regarding the product. If you wish to know more about reverse mortgages, don’t hesitate to call Reverse Mortgage Specialist.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Is Reverse Mortgage Safe?

As you start or approach retirement, many people find that they may need more income. There are many ways to increase your cash inflows like a dividend paying stock or a part time job. But there’s another option that you may want to consider – reverse mortgage. What is a reverse mortgage and is it safe?

Understanding Reverse Mortgage

Getting a reverse mortgage loan is just like selling your house to a lender in return for money. It may be in the form of an income stream, line of credit, or a lump sum. You will be allowed to stay in your house for as long as you can. It is still a loan and you will borrow an amount that is less than the value of your home. The amount that you owe will increase as time passes by as interest rates are applied.

You don’t have to repay the loan until you die, stop living in the house, decide to sell your home, or move to a nursing home. During that time, your house could be sold to cover your debt. Your heirs may keep the house provided that they repay the loan.

What Is So Good About A Reverse Mortgage?

The big plus of a reverse mortgage Columbia is that it can provide you with an income stream that could be very welcome once you retire. With countless Americans underprepared for retirement in terms of their finances, getting a loan could be helpful.

A reverse mortgage tend to be tax free and that is another benefit that borrowers will enjoy. Other retirement funding options require you to downsize and sell your house or even to move to a much less expensive region, reverse mortgages will allow you to stay in your house while you receive regular payments.

Is A Reverse Mortgage Safe?

Reverse mortgage is an effective and safe way to increase your retirement income. But it also has its own set of disadvantages.

You may be sold one with terms that are less ideal by a pushy sales person. Do not fall for their hard sale pitches. In case you are interested in a reverse mortgage, it is better if you get in touch with solid lenders on your own and maybe have an attorney or reverse mortgage specialist to help you out before you sign any contract.

You might not get as much income through a reverse mortgage as you may have expected. The amount of money that you can borrow would depend on certain factors like your life expectancy and that of your spouse, as well as the home value, home equity, and the current interest rates. As time goes by, interest rates will be added to your loan balance and you also have to deal with closing costs, just like other types of loan.

A reverse mortgage loan may not be the financial option that you thought it was since you will still be held accountable for paying off home related expenses like home insurance, property taxes, home maintenance, and home repairs.

Call Reverse Mortgage Specialist if you wish to know if a reverse mortgage is the best option for you.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Can A Reverse Mortgage Lead To Foreclosure?

Many people who are interested in getting a reverse mortgage are wondering if this type of loan could lead to a foreclosure. The answer is yes. But there’s one important thing that you need to know. The circumstances that would cause a reverse mortgage foreclosure are different from the situations leading to a conventional mortgage foreclosure. If homeowners hear about foreclosure, they immediately think about failing to make the needed monthly payment for the mortgage. Well, this doesn’t really apply to a reverse mortgage loan since it does not carry any monthly repayment obligation.

It’s no wonder many people and even the media get a lot of things wrong about reverse mortgage foreclosures. It’s crucial to note remember that a foreclosure could be the resolution of a reverse mortgage loan once the borrower dies. In case the balance that’s due goes beyond the value of the loan, or if the late borrower has no next of kin to take care of the sale, the estate would just let the home go into a foreclosure.

Factors Leading To Reverse Mortgage Foreclosure

Why Foreclosures Happen?

Although reverse mortgages do not need a monthly principal as well as interest mortgage payment during the loan’s duration, there are other obligations that the borrower need to fulfill like maintaining the home and paying all property related costs. Ignoring these costs would lead to loan maturity. If that happens, the loan borrower or the heirs would end up selling the house to pay off the balance on the loan. In case there’s no action to sell the house, the lender would have to foreclose on the house and deal with the sale on their own so that the loan could be repaid.

No Equity Remains At Reverse Mortgage Loan Maturity

The loan balance in some cases goes beyond the reasonable sales price of the house if the loan matures. In this situations, they don’t have any economic incentive to sell of the house on their own. Fortunately, reverse mortgage loans are considered non recourse loans and provide them the chance to just walk away even with a loan deficiency. This should not affect their credit profile. However, the HUD is given the title to the house through foreclosure, allowing them to sell the house and pay off at least a part of the balance of the loan.

A Property Tax Default Happens

Not being able to pay the property taxes will almost always lead to foreclosure. This holds true if the homeowner has a conventional mortgage, reverse mortgage, or not mortgage at all. Unfortunately for the lender, they’re the primary lien-holder on the house and are mandated by federal rules to foreclose on the house for most reverse mortgages loan. In 2015, the HUD created a mandatory financial assessment of each borrower that has significantly decreased the number of property charge defaults.

Always remember that a reverse mortgage Greenville lets the homeowner gets access to funds that would in theory, lower the likelihood that a borrower would default on their payment obligations. However, with the rising financial pressures of going into retirement, people can’t always expect a perfect outcome.

Call Reverse Mortgage Specialist if you want to know more about this loan and if you need professional help in deciding whether this is the best option for your retirement plan.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Reverse Mortgage: What You Need To Know?

Home is the biggest investment for many people. In the United States, the median home price is $272,200, the National Association of Realtors said. In a few hot markets like San Francisco and New York City, the prices of homes are way higher. The problem for many people is getting access to that investment. Selling your home and relocating in a new place is a good solution, but that is a difficult decision for a few people. If you have paid off your mortgage totally or a big part of it, a reverse mortgage could be a good solution. However, you need to fully understand how it works before you make a decision.

Reverse Mortgage: Your Home Is A Piggy Bank

A reverse mortgage loan is a type of loan that is based on the equity or paid up current value of your house. Unlike a traditional mortgage, your lender will pay you monthly, in a lump sum or through a viable line of credit. You will not be required to pay back the loan until you sell your home, you die, or you move out. Your balance will be deducted from the proceeds of the home sale once it comes due and you or your heirs, if you have one, will get any remaining cash.

HECM or home equity conversion mortgage is the most common reverse mortgage, which is insured by the Federal Housing Administration. You might also be able to obtain a reverse mortgage loan through your local or state governments or through private lenders.

The federal insurance will guarantee that when the loan balance goes beyond the sale price of your home, your heirs do not need to pay more than 95% of the appraised value.

Types of Housing

You could obtain an HECM on a single family, two to four unit home where the possible reverse mortgage client owns one unit. Mobile homes or condominiums that have been approved by HUD or Housing and UrbanDevelopment with a permanent foundation that’s manufactured right after June 1976 could be qualified for a reverse mortgage loan.

Eligibility For A Reverse Mortgage Loan

If you wish to qualify for this kind of reverse mortgage Greenville, you need to be at least 62 years old. You have to live in your house as your principal residence. You cannot be delinquent on any federal debut and you should undergo an education session with an HECM counselor that’s been approved by the HUD.

The Fees

Reverse mortgage loans can be expensive. The interest rate is higher than a conventional loan. Lenders will expect for you to continue paying home insurance, property taxes, as well as homeowners association fees, even though some will take a part of the loan proceeds for these expenses. It is also important to continue home maintenance to prevent minor home problems from become serious ones that could reduce the value of your property.

Call Reverse Mortgage Specialist and learn more about reverse mortgage and if it should be part of your retirement plan. 

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Is Reverse Mortgage A Good Solution During A Down Market

An American College of Financial Services professor recommended finding opportunities to use reverse mortgage in a volatile stock market. This type of loan can help preserve a portfolio and offers it a chance to recover.

Take for example a retiree who requires $3,000 per month out of her portfolio to cover one year’s worth of expenses. In case the index fund comes with a value of $250 per share, 144 shares need to be sold to recover the amount or about 180 shares in case the stock market forces the fund to drop by 25%.

Home equity can help create stability during retirement. In February, the stock market experienced its first drop after all the good news. Originators of reverse mortgage loan said a short term correction can’t boost the volumes. However, the extended uncertainty could do just that. Since that time, the market has witnessed wild swings during the  unilateral actions of the president on trade, which could trigger an opening for HECMs to address a need for seniors concerned about the fluctuation in the Dow Jones Industrial Average.

Reverse Mortgage: Changing The Perception

The fees and the costs associated with reverse mortgages are some of the downsides when taking out HECMs. The average origination cost is $27,000, with $18,000 as a general guideline for HECM proceeds worth $100,000.

Generally speaking, the gathering highlighted the ways that the reverse mortgage sector has changed over the years. Home equity is a good way of averting emergencies during retirement. This is commonly neglected by some retirement planners when checking out the general financial health of their clients.

Employers should also let retirees know about reverse mortgages Greenville during their exit interviews. Financial advisors should also pay more attention to housing wealth during retirement.

Call Reverse Mortgage Specialist if you need professional help in planning for your retirement and for more information about reverse mortgages.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Reverse Mortgage After Death Part 2

What happens to the reverse mortgage after the borrower's death? This is one of the most common questions when it comes to this type of loan.

What happens after death?

When the last surviving borrower of the reverse mortgage has passed, the loan balance will become due and payable. A lot of people think that the house will revert back to the bank once the last borrower dies but that is not what happens.

Your heir will have the option to choose if they would like to repay the balance of the loan or keep the house, sell it and keep its equity or just walk away and leave the house to the lender and let them take care of disposing the property.

In case they decide to keep the house, they should repay the loan, which means they need to refinance it with a new loan or use other means they have available.

They could also settle the loan at a lesser amount or about 95 percent of the existing market value. If they would rather sell the property, they have to make sure that they do whatever needs to be done to change the title so they could put the house into the market. If this is the case, it is better if the borrowers talk to an estate attorney first to make sure that they are taking the needed measures for their unique situation.

Will Your Heirs Be Held Responsible For The Balance Of Your Reverse Mortgage?

The heirs who will get the house will have to repay the outstanding balance of the reverse mortgage. They can do this by selling the house within 12 months or by refinancing it into a conventional loan. The heirs can keep the remaining equity in the house.

Is It Possible To Lose Your House With Reverse Mortgages?

You may default on this type of loan if you break at least one of the three rules on loan maturity that were outlined in your agreement. If you want to keep your loan in good standing, you have to pay your homeowner’s insurance and property taxes regularly. Plus, you also need to use the house as your primary residence. If you fail to meet any of these requirements, the lender will have the right, as per the HUD, to call the reverse mortgage due.

Is It Possible To Buy The House Back?

Because the house is already your own then there’s no point to buying it back. You need to understand that reverse mortgage Greenville is just a loan against your home. There’s no prepayment penalty. Plus, you could also repay your loan in any amount you prefer, voluntarily.

Is It Possible To Walk Away From Reverse Mortgages?

In case the balance on your outstanding loan is more than the current value of the property, you could no longer stay in your house. You can walk away or create a deed in lieu of a foreclosure. Reverse mortgage loans are known as non-recourse loans, which means you cannot transfer your debt to your heirs or estate.

Call Reverse Mortgage Specialist if you want to know more about reverse mortgage, the requirements, your obligations, and how to apply.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Reverse Mortgage After Death Part 1

One of the most popular questions when it comes to reverse mortgages is what happens with the loan and the home after the borrower’s death.

Reverse mortgages are meant to be the final loan that senior loan borrowers will make and that is why this question is always on top of the minds of many homeowners as well as their heirs since many of them want to keep the loan and their house for the rest of their lives.

In case they get approved for a reverse mortgage loan, they will be able to live in their houses without having to pay mortgage for life.

The majority of the borrowers know that the eligible principal limit or the benefit amount will depend on the youngest borrower’s age along with the HUD lending limits, home value, as well as the interest rates implemented during that time.

Those who did their research and are aware of this fact are worried about the changes that may happen on their loan once one borrower, whether younger or older, dies first. They’d like to know if the remaining spouse could stay in the house, if there will be any changes to the reverse mortgage loan, and what will be the effect on their heirs.

As a matter of fact, all borrowers who have heirs are almost always worried about what will happen to their mortgage and their homes once they pass away.

You should know that the terms do not change when the loan closes. The original terms remain if one of the loan borrowers has to leave the house or if one dies before the other one, regardless of the age of the borrower who’s remained.

Reverse Mortgage Vs. Traditional Loans

Reverse mortgage, as its name implies, is the reverse of a traditional mortgage. In the latter, the borrower makes monthly payments to the lender until the loan amount plus interest is settled. In a reverse mortgage, the lender pays the borrower the amount of the loan. The loan, interest and other charges accrue and will be due once the last borrower leaves the house permanently.

Although no repayment is due on a reverse mortgage, there’s no prepayment penalty and that means borrowers could opt to make payment in their preferred amount at any time without worrying about the penalty. But the borrower is not required to do such a thing until they permanently move out of the house or if they decide to sell their home.

However, borrowers must remember that they still need to pay the insurance and taxes of the house as well as the regular upkeep of their home. The requirements are the same as with a forward or traditional mortgage. If you don’t pay them, it will be considered as default under the loan’s terms.

What About The Interest?

There is a principal limit or maximum loan amount on every reverse mortgage loan. When it comes to how you receive the money and how fast the interest accrues will be up to you. More interest would accrue on the loan if you borrow more money and you borrow it earlier in the loan.

For instance, if you get a reverse mortgage loan under the line of credit option or payment option but you only draw a little every now and then, then the interest on your loan would not accrue as fast as those borrowers who take a lump sum on the whole amount.

This will make sure that the least amount of interest would accumulate and the balance is going to be the lowest possible once you pay back the loan. If you just want to settle an existing mortgage loan so you can stay in your house, if you don’t have any heir, then you can use the proceeds of the loan to may you live comfortably during your retirement years.

Call Reverse Mortgage Specialist now and learn more about the benefits of taking out a reverse mortgage.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Who Will Pay Back Your Reverse Mortgage?

Repayment is always a concern when it comes to any kind of loan. When is it due and who will pay it back? These are a few of the most common questions asked and they also apply to reverse mortgage loans. It’s best to take a first look at when a reverse mortgage need to be repaid if you wish to know the answer as to who needs to repay the loan. The time when the loan will be due would depend on different factors. They also determine the method of repayment and who’s responsible for repaying it.

When Is A Reverse Mortgage Due?

You don’t need to repay reverse mortgage loans until is due, though you need to deal with the homeowners insurance, property taxes, as well as the home maintenance costs. Provided that you follow these financial obligations, the loan won’t come due until you move out or sell the house, or upon your death. If the loan comes due under one of these situations, the one responsible for paying back the loan are as follows.

If You Move Out or Sell Your Home

Among the eligibility needs of the reverse mortgage loan is that your house should be your main residence. If your house is not your primary residence any more, meaning you live in the house for six months at most then your loan will become due. When this happens, you will be responsible for paying the loan back. Generally, the proceeds of the home sale can be used to pay the loan back. Any remaining amount from the sale will be yours to keep. Keep in mind that you pay only what you borrowed along with the interest that may have accrued as time goes by.

If You Die

A lot of people are concerned that their heirs would be left to pay back the loan after they die. Heirs will have a few options. If they want to keep the house, they could use the proceeds from the home sale to pay off the reverse mortgage in Greenville. Any remaining amount will be theirs to keep. They also have the option to sign the deed over to the lender and walk away from the house without any responsibility to sell the home or pay back the loan.

A Non-Recourse Loan

A reverse mortgage that is insured by the government is referred to as a non-recourse loan. This means, when the house sells for less that what’s owned on the loan, FHA insurance could cover the difference and not you or your heirs.

Call Reverse Mortgage Specialist now if you want to know more about reverse mortgages.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Is Refinancing A Reverse Mortgage Possible?

A reverse mortgage can provide homeowners who are at least 62 years old access to home equity. Just like a traditional mortgage, a reverse mortgage could be refinanced, and this move sometimes makes more sense.

Understanding Reverse Mortgages

A reverse mortgage is a type of loan that lets older borrowers tap into their home equity. Unlike a conventional mortgage, which asks the borrowers to pay a lender, a reverse mortgage requires the lender to make pay the borrower regularly.

Interest will accrue on the reverse mortgage loan with the repayment on the principal loan and interest deferred until you pass away, move out, or sell the home. This could be helpful in terms of supplementing your retirement income. However, it deducts equity from your house.

Types of Reverse Mortgages

There are a few types of reverse mortgages.

HECMs or Home Equity Conversion Mortgages – insured by the FHA or Federal Housing Administration. If you are looking to buy a new home then you should consider HECM for Purchase mortgages.

Proprietary Reverse Mortgages – similar to HECMs. The main difference is that they are not insured by the government.

Single Purpose Reverse Mortgages – are used for a single purchase

How Does Reverse Mortgage Refinance Works?

Knowing the process involved in a reverse mortgage refinance is helpful regardless of the reason why you want to have one.

Refinancing a reverse mortgage loan is comparable to refinancing a traditional mortgage. Basically, you are replacing your reverse mortgage with a new, different, and better loan. The new one might have a different interest rate or provide a different monthly payout, based on the financing terms.

You need to meet a certain set of criteria if you wish to qualify for a reverse mortgage refinance. There should be a definitive advantage for a lender to justify refinancing the reverse mortgage of a lender. This rule was set in place by the National Reverse Mortgage Lenders Association.

The rule states that when a reverse mortgage is refinanced, the rise in the principal amount should be equal or more than five times the closing cost of the loan. The loan proceeds should be equal to ore above 5% of the amount that is being refinanced.

Apart from that, homeowners is required to meet a seasoning requirement, which refers to the duration when you’ve held the mortgage. You could refinance if it’s been at least 18 months since you closed your original reverse mortgage.

The borrower must also qualify for a new reverse mortgage in Greenville. Fortunately, the criteria that is used to determine if a borrower qualifies or not for a reverse mortgage is the same with the requirements for refinancing.

The borrower requirements for HECMs are as follows:

• -      At least 62 years old
• -      You are using your home as your primary residence
• -      You own the house or you have paid a significant amount of the original mortgage.
• -      Not being a delinquent on your federal debt

-      Have the ability to fulfill your financial obligations that are related to the house like homeowners insurance, property taxes, and homeowners association fees.

The property also needs to meet the requirements set by the FHA. Basically, it means the owner must occupy one unit of the house. There shouldn’t be any safety or health hazards and the owner should have flood insurance if the property is located in a high risk area.

Call Reverse Mortgage Specialist for more information about reverse mortgage refinancing.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/