Showing posts with label home purchase Reverse Mortgage. Show all posts
Showing posts with label home purchase Reverse Mortgage. Show all posts
2/14/2009
REVERSE MORTGAGE LIMITS RAISED TO $625,500
A BOON FOR SENIORS: STIMULUS
BILL RAISES REVERSE
MORTGAGES TO $625,500.
Within the Stimulus Bill just passed by both the House of Representatives and the Senate, and now on the way to President Obama for signature (hopefully, by Monday, Feb.16th, President's Day) are a number of provisions that will be helpful to Senior Citizens. Below is an article from AARP which outlines these benefits. For senior's interested in larger Reverse Mortgages, there is good news, indeed, as the maximum cap has been raised over $200,000 from $417,000 to $625,500.
Please read on.....
Gloria
----------------------------------------------------------------------------------
AARP: Stimulus is First Step Toward
Restoring Long-Term Financial
Security for Older Americans
WASHINGTON, Feb. 13 /PRNewswire-FirstCall
In a historic and critical vote, Congress today passed the American Recovery and Reinvestment Act of 2009. Designated as a "key vote" by AARP on behalf of its 40 million members, the elected officials' votes will be posted on AARP's Government Watch site (www.aarp.org/governmentwatch) so that individuals across the nation can see how their elected official voted on this legislation.
(Logo: http://www.newscom.com/cgi-bin/prnh/20070209/NYF043LOGO )
Nancy LeaMond, Executive Vice President at AARP, released the following statement today:
"Unprecedented job loss, loss of savings and investments, and rising numbers of uninsured individuals has forced every American to take notice of this dire moment in history. The passage of the American Recovery and Reinvestment Act of 2009 is a critical moment for Americans young and old and a vital jump start to our ailing economy.
"AARP is pleased to see that Congress included a $250 economic recovery payment for older Americans, veterans and people with disabilities who are not eligible for the Make Work Pay credit.
"Additionally, we are encouraged by the long-term investment made by Congress that brings us steps closer to health care reform. Funding for health information technology, comparative effectiveness research and nurse and primary care training are all essential building blocks for reform and AARP is encouraged by their inclusion in the stimulus bill.
"While this landmark legislation is crucial to addressing our nation's most pressing issues today, many critical issues remain, including bolstering and securing the housing market, protecting homeowners from foreclosure and jumpstarting the credit markets. As an organization that regularly works with both sides of the aisle, we are hopeful for bipartisan solutions to these issues as Congress and the new administration move forward."
In a recent letter from AARP CEO Bill Novelli to House and Senate leadership outlines the most important issues for older Americans in this legislation:
The bill contains many provisions that we believe are paramount to promoting economic growth, assisting those most affected by the economic crisis, and providing the foundation for meeting critical needs, such as health care and the development of livable communities. Among the provisions we agree are especially needed are:
A $250 economic recovery payment for older persons, veterans, and individuals with disabilities who are ineligible to receive a Make Work Pay credit.
A significant increase in Medicaid spending that will help to stimulate the economy as the current economic downturn causes caseloads to rise while revenues plummet.
Essential building blocks for health care reform, including support for health information technology that includes critical privacy protections, health care comparative effectiveness research, and nurse and primary care training. These changes are critical because we cannot fix our economy if we do not address our broken health care system.
--An increase in funding for the Social Security Administration at a time of significant caseload increases.
--Affordable health insurance via subsidized COBRA for those who have lost health coverage along with jobs.
--An extension and increase in unemployment benefits. Over the past twelve months the number of unemployed aged 55 and older has risen by 65 percent.
--An increase in Food Stamps and other nutrition support. Fixed and low-income individuals face unacceptable choices as food costs increase along with the price of medicine and health care.
--An increase in the Weatherization Assistance Program to help low-income and older couples reduce their energy costs.
--A substantial increase in funding for transportation infrastructure projects that expand mobility options, including mass transit, rural and para-transit programs, and improved coordination of human services transportation programs.
--An increase in the loan value limit for FHA-insured reverse equity mortgages that would allow greater numbers of older homeowners to safely tap the equity in their homes to refinance unaffordable mortgages, obtain more suitable housing, pay medical bills or just meet daily living costs.
2/12/2009
REVERSE MORTGAGE LOAN LOOKS TO BE $625,500
STIMULUS BILL COMPROMISE INCREASES
REVERSE MORTGAGE CAP TO $625,500
(For those that need a Jumbo this is great news)
NRMLA is pleased to announce that we have learned that the compromise package emerging from the House-Senate conference committee includes the House language setting the HECM loan limit at 150% of the Freddie Mac limit, which would put it at $625,500 -- for the balance of 2009 only. (Congress would have to act on it again before this year is out to extend it beyond '09.)
The conference report must still be voted on separately by the House and the Senate, so it is not yet entirely final.
The House adopted a non-binding motion on Tuesday that directs the conference report be posted on the Internet for 48 hours before the House votes. That would put the House floor vote the evening of Feb. 14, at the earliest, if the conference report is posted today.
Once both houses of Congress approve the conference report, it will be sent to President Obama for his signature.
After the President signs the bill, HUD will have to issue a Mortgagee Letter to implement the change. From our previous experience, we have learned that there is no telling exactly how long it will take for them to get this done, but with the temporary nature of this provision, I hope that they will act expeditiously.
We are still waiting to verify that this is correct by seeing the actual conference report.
Peter H. Bell, President
REVERSE MORTGAGE CAP TO $625,500
(For those that need a Jumbo this is great news)
NRMLA is pleased to announce that we have learned that the compromise package emerging from the House-Senate conference committee includes the House language setting the HECM loan limit at 150% of the Freddie Mac limit, which would put it at $625,500 -- for the balance of 2009 only. (Congress would have to act on it again before this year is out to extend it beyond '09.)
The conference report must still be voted on separately by the House and the Senate, so it is not yet entirely final.
The House adopted a non-binding motion on Tuesday that directs the conference report be posted on the Internet for 48 hours before the House votes. That would put the House floor vote the evening of Feb. 14, at the earliest, if the conference report is posted today.
Once both houses of Congress approve the conference report, it will be sent to President Obama for his signature.
After the President signs the bill, HUD will have to issue a Mortgagee Letter to implement the change. From our previous experience, we have learned that there is no telling exactly how long it will take for them to get this done, but with the temporary nature of this provision, I hope that they will act expeditiously.
We are still waiting to verify that this is correct by seeing the actual conference report.
Peter H. Bell, President
1/27/2009
Ever More Popular Reverse Mortgages: Risks and Rewards (ABC News)
From ABC News Transcript from newshow
and interview of Mellody Hobson,
GMA Financial Contributor
Risks vs. Rewards
GMA Financial Contributor Tells You
How to Qualify, and About Other Options
By MELLODY HOBSON
Jan. 8, 2008 —
There is an increasing trend among senior citizens in need of money for their rising health care and prescription drug costs taking out a reverse mortgage or in essence, getting paid by their home. According to the National Reverse Mortgage Lenders Association, the number of reverse mortgages insured by the U.S. Department of Housing and Urban Development (representing 90 percent of all such loans) has surged from 157 in 1990 to more than 107,558 in 2007, with a forecast of more than 200,000 this year.
The reason?
More than 12.5 million seniors over the age of 65 own their homes free and clear, and are sitting on more than $4 trillion in home equity money which many need to put toward their daily living and medical expenses.
Mellody, can you help us understand how a reverse mortgage works? How is it different from a traditional mortgage or home equity loan?
A reverse mortgage is exactly what it sounds like-- it is the opposite of a traditional mortgage. With a traditional mortgage, you borrow money from a bank to purchase a home and then repay this loan with interest over time. A home equity loan is similar, except you are borrowing against the equity you have built up in your home and repaying that amount with interest over a
specific period of time. When applying for both a mortgage and a home equity loan, there are income thresholds to ensure that you can repay whatever you are borrowing.
Conversely, with a reverse mortgage, there are no income requirements, (or credit score requirement or asset requirements /GB) and the lender essentially pays you to live in your home.
Specifically, the equity you have built up in your home can be paid back to you in one of the following ways: a single lump sum of cash; a regular payout as long as you live in the home; a credit line to be accessed when you need it; or a combination of these options. And, you do not have to repay any of this money until the last borrower dies, sells the home or moves away permanently.
The money you receive from a reverse mortgage can be used for anything, including daily living expenses, medical bills, prescription costs and even home repairs. (And, as of 1-1-09 the funds can be used to purchase a home, and purchase or refinance a Co-Op that meets FHA standards./GB)
Can anyone qualify for a reverse mortgage? What are the costs?
To qualify for a reverse mortgage, you must own your home and be at least 62 years old. The amount you can borrow depends upon your age, how much your home is worth and current interest rates. Additionally, you must meet the following qualifications:
Your home must be your primary residence.
You must have paid off your entire loan or have significant equity built up that your mortgage balance can be paid off with a small portion of the reverse mortgage.
Your home must be in structurally good condition and free of major problems such as termite damage or roof leaks.
In terms of costs, this is where it can get a little tricky. Costs mirror those of typical closing costs on a traditional mortgage and include title insurance, origination and appraisal fees as well as other costs. On average, it might cost $8,000 or $9,000 for a $150,000 loan. Keep in mind, these expenses can be rolled into the amount you receive from the reverse mortgage, so having this cash up front is not necessary..
This all sounds great. Are there any downsides?
There are a few key downsides to keep in mind when considering a reverse mortgage. In addition to the costs I just mentioned, taking advantage of a reverse mortgage may affect your eligibility for state and federal government assistance programs, such as Medicaid.
(standard Social Security and Medicare are not affected by having a reverse mortgage/GB)
Also, once you begin withdrawing equity from your home, there will be less money left over once the home is sold and the loan is repaid meaning less money to pass along to your heirs.
Should seniors be watchful about anything when considering a lender for their reverse mortgage?
Unfortunately, the answer is yes. Cash-strapped seniors are likely targets for predatory lenders and brokers who may try to steer them into loan products which generate significant costs for the borrower (and profits for the lender or broker).
While counseling on the pros and cons of a reverse mortgage is a requirement for federally insured loans which account for the majority of loans today it is not always adequate. If you are wondering whether a reverse mortgage is a good choice for you, try to do as much research on your own about the available options. You also may want to enlist the help of a trusted friend or family member who can help you sift through your finances as well as the details of any potential loan.
So, would you recommend reverse mortgages to seniors?
It really depends on your personal situation. The Federal Trade Commission puts it best... a reverse mortgage is for those who are house rich, but cash poor.
Reverse mortgages can provide a great safety net, but it is important to have a long-term plan in place before making any decisions.
One of the most important benefits of a reverse mortgage is that the lender cannot remove homeowners from their homes as long as they stay current with their property taxes, insurance and home maintenance. This fact alone can provide important security to many seniors.
That said, a reverse mortgage is not necessarily a panacea. And if you live in an area where the housing market is relatively stable (versus depressed), don't forget to consider selling your home and downsizing to a smaller home as an option.
(And, you can get a reverse mortgage, with no qualifying, to help you purchase your new home and thus have no mortgage payments. Also, you might not need all the equity from your current home for a down payment, so it can be added to your savings account. /GB)
Copyright © 2009 ABC News Internet Ventures
var s_account = "wdgnewabcnews,wdgasec";
and interview of Mellody Hobson,
GMA Financial Contributor
Risks vs. Rewards
GMA Financial Contributor Tells You
How to Qualify, and About Other Options
By MELLODY HOBSON
Jan. 8, 2008 —
There is an increasing trend among senior citizens in need of money for their rising health care and prescription drug costs taking out a reverse mortgage or in essence, getting paid by their home. According to the National Reverse Mortgage Lenders Association, the number of reverse mortgages insured by the U.S. Department of Housing and Urban Development (representing 90 percent of all such loans) has surged from 157 in 1990 to more than 107,558 in 2007, with a forecast of more than 200,000 this year.
The reason?
More than 12.5 million seniors over the age of 65 own their homes free and clear, and are sitting on more than $4 trillion in home equity money which many need to put toward their daily living and medical expenses.
Mellody, can you help us understand how a reverse mortgage works? How is it different from a traditional mortgage or home equity loan?
A reverse mortgage is exactly what it sounds like-- it is the opposite of a traditional mortgage. With a traditional mortgage, you borrow money from a bank to purchase a home and then repay this loan with interest over time. A home equity loan is similar, except you are borrowing against the equity you have built up in your home and repaying that amount with interest over a
specific period of time. When applying for both a mortgage and a home equity loan, there are income thresholds to ensure that you can repay whatever you are borrowing.Conversely, with a reverse mortgage, there are no income requirements, (or credit score requirement or asset requirements /GB) and the lender essentially pays you to live in your home.
Specifically, the equity you have built up in your home can be paid back to you in one of the following ways: a single lump sum of cash; a regular payout as long as you live in the home; a credit line to be accessed when you need it; or a combination of these options. And, you do not have to repay any of this money until the last borrower dies, sells the home or moves away permanently.
The money you receive from a reverse mortgage can be used for anything, including daily living expenses, medical bills, prescription costs and even home repairs. (And, as of 1-1-09 the funds can be used to purchase a home, and purchase or refinance a Co-Op that meets FHA standards./GB)
Can anyone qualify for a reverse mortgage? What are the costs?
To qualify for a reverse mortgage, you must own your home and be at least 62 years old. The amount you can borrow depends upon your age, how much your home is worth and current interest rates. Additionally, you must meet the following qualifications:
Your home must be your primary residence.
You must have paid off your entire loan or have significant equity built up that your mortgage balance can be paid off with a small portion of the reverse mortgage.
Your home must be in structurally good condition and free of major problems such as termite damage or roof leaks.
In terms of costs, this is where it can get a little tricky. Costs mirror those of typical closing costs on a traditional mortgage and include title insurance, origination and appraisal fees as well as other costs. On average, it might cost $8,000 or $9,000 for a $150,000 loan. Keep in mind, these expenses can be rolled into the amount you receive from the reverse mortgage, so having this cash up front is not necessary..
This all sounds great. Are there any downsides?
There are a few key downsides to keep in mind when considering a reverse mortgage. In addition to the costs I just mentioned, taking advantage of a reverse mortgage may affect your eligibility for state and federal government assistance programs, such as Medicaid.
(standard Social Security and Medicare are not affected by having a reverse mortgage/GB)Also, once you begin withdrawing equity from your home, there will be less money left over once the home is sold and the loan is repaid meaning less money to pass along to your heirs.
Should seniors be watchful about anything when considering a lender for their reverse mortgage?
Unfortunately, the answer is yes. Cash-strapped seniors are likely targets for predatory lenders and brokers who may try to steer them into loan products which generate significant costs for the borrower (and profits for the lender or broker).
While counseling on the pros and cons of a reverse mortgage is a requirement for federally insured loans which account for the majority of loans today it is not always adequate. If you are wondering whether a reverse mortgage is a good choice for you, try to do as much research on your own about the available options. You also may want to enlist the help of a trusted friend or family member who can help you sift through your finances as well as the details of any potential loan.
So, would you recommend reverse mortgages to seniors?
It really depends on your personal situation. The Federal Trade Commission puts it best... a reverse mortgage is for those who are house rich, but cash poor.
Reverse mortgages can provide a great safety net, but it is important to have a long-term plan in place before making any decisions.
One of the most important benefits of a reverse mortgage is that the lender cannot remove homeowners from their homes as long as they stay current with their property taxes, insurance and home maintenance. This fact alone can provide important security to many seniors.
That said, a reverse mortgage is not necessarily a panacea. And if you live in an area where the housing market is relatively stable (versus depressed), don't forget to consider selling your home and downsizing to a smaller home as an option.
(And, you can get a reverse mortgage, with no qualifying, to help you purchase your new home and thus have no mortgage payments. Also, you might not need all the equity from your current home for a down payment, so it can be added to your savings account. /GB)
Copyright © 2009 ABC News Internet Ventures
var s_account = "wdgnewabcnews,wdgasec";
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