Category: Information for Financial Planners

5 Things You Should Know About A Reverse Mortgage

Posted on by janjordan

Reverse Mortgage Colorado Fort Collins Loveland Greeley

 

If you’re a senior over 62, reverse mortgage marketing will begin to creep into your life.  It’s inevitable.  Sometimes it’s big, flashy promises and other times it’s scary horror stories.  To help you filter through the hype, here are 5 important things every senior should know about a reverse mortgage:

 

1. You do not make monthly mortgage payments.  Yes, that’s right, homeowners with a reverse mortgage do not need to make monthly mortgage or interest payments as long as they live in the home and keep it as their primary residence.  Borrowers will be required to continue paying property taxes, homeowners insurance, general upkeep, and standard utilities (such as water, gas, and electricity).

 

2. There are no credit or income requirements.  It’s true, there are no credit and income requirements to obtain a reverse mortgage.  There are, however, borrower and property eligibility requirements.  For example, the borrower must be age 62 or older.  The home must be their primary residence and the property type will need to meet certain HUD guidelines, meaning it must be a:

  • Single family home or 2-4 unit home with one unit occupied by the borrower
  • HUD-approved condominium
  • Manufactured home that meets FHA requirements

3. You can use a reverse mortgage to purchase a home – even if you’ve never been a homeowner before.  There are a few options to use a reverse mortgage to purchase a home.  When purchasing a home, the borrower will be required to make a down payment, but will enjoy living mortgage payment free in this new home.  Click here for much more information about purchasing a home with a reverse mortgage.

 

4. Married couples can both be on a reverse mortgage.  If both borrowers are 62 and over, both can be on the reverse mortgage.  If a spouse passes or moves to an assisted care facility, the remaining borrower can stay in the home.  A reverse mortgage lender should be able to answer any questions regarding married couples and ensure both spouses feel confident in their decision.

 

5. You retain to the title to your home.  Yes, you are still the “owner” and you will always retain the title to your home.

 

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Longmont, Greeley, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming.  Click here to contact Jan and learn if reverse mortgage is right for you.

reverse mortgage loveland greeley fort collins longmont colorado cheyenne

HECM LOC Credit Line Grows Every Month

Posted on by janjordan

Unlike the traditional HELOC’s fixed borrowing limit, the HECM credit line increases at the current compounding rate. This feature is particularly valuable the longer the client stays in their home.

 

 

A scenario: A 62 year-old couple has a home worth $200,000 with no mortgage. They get a HECM LOC and keep it in standby, not taking any money out of it yet – perhaps they are keeping it in reserve to help them if their health fails. Say their initial HECM borrowing limit is $100,000 (they could get more but opt not to), and their compounding rate happens to stay at 7.2% for the next 30 years. Using the Rule of 72 for doubling your money their credit line doubles every 10 years, as shown in the table below. Their $200,000 house appreciates 3% a year, so it is worth $360,000 on their 82th birthday. At their 92nd birthday, their home is worth $485,000 – a fraction of what they could withdraw from their $800,000 HECM.

 

reverse mortgage loveland greeley fort collins longmont colorado cheyenne

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Longmont, Greeley, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming.  Click here to contact Jan and learn if reverse mortgage is right for you.

NBC’s Today Show Discusses Reverse Mortgage

Posted on by janjordan

In this great 4 minute video from NBC’s The Today Show, financial editor Jean Chatzky answers some common questions about reverse mortgage, how they work, and whom they are right for.

 

Touching on the issue of home inheritance she urges potential borrowers to ask the question: why are they so attached to their homes?  An excellent first question to anyone who thinks a reverse mortgage may not fit their needs.

 

 

Reverse mortgages are available to homeowners 62 and older, with minimal income and credit requirements.  A reverse mortgage for purchase is also an option for those looking to buy a new home or move from their current residence.

 

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you.

Reverse Mortgage Fosters Relationship with Senior Real Estate Specialists

Posted on by janjordan

reverse mortgage colorado loveland fort collins longmont greeley boulderMany changes have come to Colorado’s reverse mortgage industry in the past several months.  These changes have had a positive impact on an industry that was once thought to only serve cash-strapped seniors who had no other options.  As financial planners and realtors are learning about the various opportunities available with a reverse mortgage, better education of potential consumers is fostering an important relationship between lenders, seniors and their advisers.

 

This is why Security One Lending has partnered with the Senior Real Estate Specialists (SERS) Council, the goal being to help over SERS’s more than 15,000 realtors better understand how a reverse mortgage may help those they serve – seniors 50 and over.

 

“Security One Lending is excited to have this new relationship with the SRES Council as we have a shared mission, a dedication to providing outstanding service to the senior community,” Torry Larsen, Security One’s president of retail lending said. “Now more than ever, seniors need to be aware of their options when it comes to housing. By working with the SRES Realtors we can both serve as a dedicated, knowledgeable resource on a national and local level.”

 

Reverse mortgages are available to seniors 62 and over, with minimal income and credit requirements.  There are options to use a traditional reverse mortgage to live mortgage payment free and receive either a lump sum or monthly installments of funds received from the transaction – or use a reverse mortgage to purchase a home.

 

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you.

How to Alleviate HELOC Payment Shock with Reverse Mortgage

Posted on by janjordan

Reverse Mortgage Colorado Financial Planning
At the peak of the housing boom thousands of Loveland and Fort Collins homeowners tapped into their biggest asset – their home – and took out a home equity line of credit or a HELOC.  Many of these loans are set to amortize after 10 years, meaning these borrowers are about to see some serious payment shock as their loans readjust and their payments now include interest and principal.  The Office of Comptroller of the Currency estimates that 60% of all HELOC balances will start amortizing between 2014 and 2017, and resetting to higher payments could cause a jump in delinquencies.  In addition, analysts at Moody’s Investor Services are warning banks of impending losses, worrying this situation may prove problematic, just as payment adjustments during the 2008 housing crisis did.

 

For retirees already living on a fixed income, borrowers may scramble to make these adjustments fit into their budgets.  But homeowners 62 and over have another option – reverse mortgage.  With a reverse mortgage seniors have the ability to not only alleviate any impending HELOC payment shock but also live mortgage payment free throughout retirement – all with minimal income and credit requirements.  Once a homeowner has obtained a reverse mortgage, they are able to receive their funds in a one-time lump sum or as monthly payments made directly to them.

 

This scenario is also something to consider for homeowners currently considering a HELOC to make home repairs or improvements.  Considering the difference between a home equity loan and a reverse mortgage is important when developing a long term plan.  Learn more about HELOC vs Reverse Mortgage here.
Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado. Click here to contact Jan and learn if reverse mortgage is right for you.

 

A Retirement Crisis by the Numbers

Posted on by janjordan

colorado reverse mortgage fort collins denver loveland greeley windsorNumbers are being released showing that the impending retirement crisis may be worse than originally thought.

 

Half of Americans have less than $10,000 in savings.  Nearly half of the oldest Baby Boomer generation have insufficient resources to pay for basic retirement living expenses and healthcare costs.

 

The Center for Retirement Research at Boston College estimates that our “retirement income deficit” is $6.6 trillion. That number represents the gap between pension and retirement savings that American households have today and what they should have to maintain their standard of living in retirement.

 

Over 6 million American seniors are living in poverty.  This number is expected to grow by 33% by the year 2020.

Continue reading “A Retirement Crisis by the Numbers” →

Reverse Mortgage Changes Opens Doors of Opportunity

Posted on by janjordan

Reverse Mortgage Loveland Fort Collins Denver Boulder Longmont Greeley ColoradoSince the reverse mortgage industry saw big changes earlier this year, financial planners, retirement specialists, and lenders are collaborating more than ever before.  In an effort to ensure these revisions are thoroughly understood and appropriate solutions are offered to clients, a strong relationship between professionals is vitally important.

 

Because of these newly developed relationships, it appears a wonderful shift is taking place.  Reverse mortgage, once stereotyped as a product for poverty stricken widows or the like, is now being realized as a product of opportunity.  More and more we’re seeing affluent and middle class retirees utilizing this option to provide financial stability and financial freedom throughout retirement.  The industry has only begun to scratch the surface of those who would benefit or will discover the possibilities when tying a reverse mortgage into their retirement plans.

 

This paradigm shift will likely increase knowledge across the board regarding both traditional reverse mortgage loans and the reverse mortgage for purchase program.  Both products are available for seniors 62 and over, with minimal income and credit requirements.

 

If you have any questions regarding the changes that have taken place surrounding the reverse mortgage industry in Colorado, please don’t hesitate to contact me.

 

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming.

Changes to Reverse Mortgage

Posted on by janjordan
Reverse Mortgage
Reverse Mortgage

 

I was recently informed that upcoming changes to the FHA Insured Reverse Mortgage program will reduce the amount of proceeds our clients will receive from the loan. FHA may increase rates which, in turn, will decrease proceeds.

 

In addition, lenders have been notified that there will be stronger qualifying guidelines in the form of a financial assessment. This change may result in taking into account FICO scores, assets, tax and insurance escrows and limiting the amount of draws a customer can take from the loan.

 

The official guidelines should be out any day and will take effect on October 1, 2013. Counseling and application would have to be completed by the end of September to qualify for existing program guidelines.  If you are interested in the FHA-Insured Revers Mortgage, now may be the time to take a second look before the new changes are implemented and qualified funds reduced.

 

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming.  Click here to contact Jan and learn if reverse mortgage is right for you.

How Reverse Mortgage is Helping the Baby Boomers

Posted on by janjordan

Reverse Mortgage Colorado Fort Collins Loveland GreeleyWhile the “baby boomer” generation inches towards retirement, the economy in many areas is still rather dismal.  Many took major losses in the 2008 economic meltdown, losing their hopes for a prosperous retirement.  In situations such as this, reverse mortgage is becoming an important piece of retirement planning.  Seniors, 62 years and older and regardless of income or credit, now have the ability to fund their retirement using the equity in their homes, alleviating mortgage payments, and receiving either a lump sum or monthly pay-outs as long as the borrower(s) remain in the residence.  For many, this option makes a world of difference, allowing for the sought after prosperous retirement years instead of barely scraping by on a budget.  Reverse mortgage funds can be used for any purpose the borrower chooses, and is often used to help with every day expenses or long term medical costs.

 

Continue reading “How Reverse Mortgage is Helping the Baby Boomers” →

Finding a Reverse Mortgage Lender

Posted on by janjordan

reverse mortgage colorado fort collins loveland greeley

 

For many seniors, a reverse mortgage is a feasible option to living within a budget, without the constraints and worry of excessive financial distress.  In order to qualify for a reverse mortgage, the individual must own their home, be at least 62 years old, and have some equity in the home.  There are no income, credit, or medical requirements.  In general, the older the borrower (or the youngest borrower in the case of couples) and the more valuable the home, the more money available.  Other factors also come into play, such as: the appraised home value, interest rates, and the amount of equity in the home.  Once a basic understanding of how a reverse mortgage works, the next step is finding a lender.

 
Continue reading “Finding a Reverse Mortgage Lender” →