HECM Reverse Mortgages Suffer Big Blow From HUD

9/23/2009

posted by N. Sioris

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HECM (Home Equity Conversion Mortgage) reverse mortgages have suffered a big blow by Congress and HUD this week. HECM loan limits will be slashed by 10%, effective October 1, 2009.

In the face of declining home values nationwide, decimated stock market portfolios, and the weakest economy since the Great Depression, HUD announced that they are cutting loan limits on all HECM reverse mortgages by 10%. The announcement was made September 23, 2009 in their mortgagee letter 2009-34.

This is highly disappointing news for senior homeowners that are barely eligible to qualify for HECM reverse mortgages, due to property values versus outstanding mortgage debt. If you happen to be one of those people that is boarder line on having sufficient equity in your home to qualify, it's quite possible that after October 1st, you will no longer be eligible for a HECM loan, unless you have the ability to contribute some of your own money to the closing.


Leaves Us Scratching Our Heads

It's puzzling to many of us, how Congress and HUD could embrace a 10% reduction in lending limits to senior citizens during such a vulnerable economic time. There is abundant evidence that many closed HECM reverse mortgages have rescued countless seniors from foreclosure and saved their homes through the use of HECM reverse mortgages.

This move, will no doubt be devastating for many senior homeowners that were in the process of considering a reverse mortgage loan, but simply had not made the commitment to act on it in time.

Combine the 10% reduction in lending limit with the expiration of the temporary HECM maximum loan amount of $625,500. reverting back to $417,000. at the end of this year, and once again, we are witnessing a perfect storm in the making.

If you need more information about how this effects your eligibility, please feel free to contact us today.

AARP Reverse Mortgage - Five Things To Consider

9/13/2009

posted by N. Sioris

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AARP has worked tirelessly with HUD to improve consumer protections and safeguards for FHA insured reverse mortgages, commonly referred to as HECM (home equity conversion mortgage) reverse mortgages. AARP has authored an extensive array of great reverse mortgage consumer guides as well as short reports and tips to assist seniors in making the right decision when considering a HECM reverse mortgage.

One AARP reverse mortgage report is entitled: "5 Questions To Ask Before Considering A Reverse Mortgage"


The Five Questions Covered In The Report Are:

* Do you really need a reverse mortgage?

* Can you afford a reverse mortgage?

* Can you afford to start using up your home equity now?

* Do you have less costly options?

* Do you fully understand how these loans work?


Here is the link to the AARP reverse mortgage report.

As always, AARP is doing its' best to educate you and make sure that you proceed with caution if you are considering a reverse mortgage. Reverse mortgages are not the end all and be all for everyone. But for those that they are right for, they can be exactly the appropriate financial tool to help sustain a comfortable lifestyle during retirement.

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.