Reverse Mortgage Blog

Final Opportunity for Condo Owners to get a Reverse Mortgage....

Reverse Mortgage Store — Mon, 14 Dec 2009 13:07:26 -0600

Spot Condo approval will be accepted until January 22nd. This is the final opportunity for condo owners to get a reverse mortgage! Visit me at Reverse Mortgage Store to learn more!

Maggie and Rob Black Video - December 2009

Reverse Mortgage Store — Mon, 07 Dec 2009 12:28:04 -0600

Maggie and Rob Black discuss reverse mortgages and how they can help seniors in this December 2009 video. They also address the negative press that has been around lately.

HUD update clarifying subordinate liens for HECM Reverse Mortgages

Reverse Mortgage Store — Mon, 30 Nov 2009 12:20:49 -0600

Loan modifications for senior homeowners are possible if the existing mortgage lender is willing to lower the principal balance to meet the net lending limit of HECM Reverse Mortgages. The borrower cannot modify their existing mortgage to create Subordinate Financing behind the HECM Reverse Mortgage, the balance of the existing mortgage must be paid in full at the time of HECM closing. Read the HUD mortgagee letter on our site!

Follow Maggie on Twitter, and become a Fan of Reverse Mortgage Store on Facebook for further updates!

A Reverse Mortgage Saves A Client's Home!

Reverse Mortgage Store — Tue, 24 Nov 2009 15:02:51 -0600

It's wonderful to know that my client, who was certain to lose her home, will now be able to live there for the rest of her life. After a great deal of time and effort, her lender, Home Eq generously dropped her principal loan balance to a level where we could put a reverse mortgage in place. My client went from unbearable worry to a future with no mortgage payments and confidence she will have a place to call home for the rest of her life. I had a chance to talk to my client the day she signed her loan documents and she agreed to record her feelings on the whole issue.

Reverse Mortgage Saves Client's Home

I think you will hear the relief in her voice..... I'm hopeful we can save more seniors from foreclosure with the help of reverse mortgages and lenders who really do want to make it work. For more information on reverse mortgages go to ReverseMortgageStore.com or to learn more about me, visit MaggieOConnell.com!

HUD Legislation Update!

Reverse Mortgage Store — Tue, 17 Nov 2009 18:49:29 -0600

Big changes in store for FHA appraisals in 2010! Three new mortgagee letters are posted at RMStore.net. Will it impact the quality of reverse mortgage appraisals and ultimately the appraised value? .... Maybe.... Another reason to get your application in before the end of the year.

Falling Reserves for FHA Insured Mortgages and Reverse Mortgages Causes Concern

Reverse Mortgage Store — Thu, 10 Sep 2009 13:08:49 -0500

The Federal Housing Administration, hit by increasing mortgage-related losses, is in danger of seeing its reserves fall below the level demanded by Congress, according to government officials, in a development that could raise concerns about whether the agency needs a taxpayer bailout ( Wall Street Journal 2009 )

Attention Condo Owners Considering a Reverse Mortgage!

Reverse Mortgage Store — Mon, 03 Aug 2009 12:59:45 -0500

Beginning on Oct. 1, 2009, all condo projects will have to go through an extensive approval process in order to qualify for a reverse mortgage. If you are considering a reverse mortgage, it's important you apply and get your counseling certificate prior to the end of August to avoid delays or possibly not qualifying at all! Call Maggie O'Connell at 800-489-0986 or e-mail at maggie@rmstore.net, or read this document for further information.

State of the California Jumbo Reverse Mortgage Market in Mid-2009

Reverse Mortgage Store — Mon, 27 Jul 2009 13:41:31 -0500

Methods for turning home equity into income has been limited for owners of high value homes.

Almost all jumbo reverse mortgages were suspended when the credit crisis hit in 2008. The HECM Reverse Mortgage has filled a void with the increased limits as a result of the stimulus plan and the higher limits ($625,500) are expected to remain through 2009. The fixed rate HECM is very attractive and provides more money than ever before for high value homes.

Now I’m pleased to announce a new program, The Equity Access Agreement.
The Equity Access Agreement has absolutely no closing costs and no interest charges because it’s not a mortgage at all. Equity Access money paid to you has no debt accrual, no closing costs and no interest charges. In exchange for monthly payments, you pay a share of the equity when you decide to sell or when you pass away. Another unique feature is, you can move away after 5 years and keep the program in place. This removes the concern of entering into an agreement and circumstances change where you have to move.

It is currently available in parts of California, Oregon and Washington.

Please CALL ME on 800 489 0986 to discuss how Equity Access can work for you!

NestWorth Announces NEW IMPROVED program!

Reverse Mortgage Store — Mon, 13 Jul 2009 13:59:44 -0500

NestWorth announces new improved program!

The Equity Access Agreement is now available. It is an alternative to a Jumbo Reverse Mortgage, but not a mortgage or debt. Older homeowners of high value homes can receive generous interest free monthly payments for a term of their choosing from 10 to 25 years. There are no set up fees, closing costs or interest charges. Qualification at 60 to 89 years old, keep current mortgage or equity line in place, benefit from high appreciation, share the risk of value declines. Owner remains on title and sells the home at any time or remains at home for lifetime.

For information call NestWorth Equity Access Specialist Maggie O'Connell at (800) 489-0986 or MyNestWorth.com

Video - The NestWorth Agreement

Reverse Mortgage Store — Wed, 27 May 2009 12:22:58 -0500

Maggie O'Connell also regularly appears on Rob Black and Your Money, Bay Area TV KRON 4. In this video of her February 4, 2009 show, she discusses the NestWorth Agreement.

Audio Clip - Maggie and Rob Black on the Radio!

Reverse Mortgage Store — Wed, 27 May 2009 12:20:07 -0500
Radio Interview with Rob Black & Maggie O'Connell discussing Reverse Mortgages and The NestWorth Agreement for California and Nevada (mp3 format).

Video - Rob Black and Your Money, May 6 2009

Reverse Mortgage Store — Wed, 27 May 2009 12:07:26 -0500

On this show, recorded May 6 2009, I discuss equity release programs with Rob Black, of Rob Black and Your Money, Bay Area TV KRON4. Learn more about reverse mortgages and the NestWorth agreement at reverse mortgage store!

May 6, 2009 show on KRON4 with Rob Black

Realtors!! Pay attention to the HECM Reverse Mortgage for Home Purchase

Reverse Mortgage Store — Tue, 26 May 2009 12:54:13 -0500

Realtors would be wise to pay attention to the HECM Reverse Mortgage for Home Purchase.

The HECM for Purchase provides the opportunity to purchase a new principal residence with HECM loan proceeds in a single transaction.

Because the HECM loan does not require repayment until the borrower leaves the home permanently, it allows buyers to qualify with no income or credit factors.

Many seniors are looking to downsize or move closer to family. They will want to sell their current residence and purchase a new residence. you are opening your agency to a whole new source of buyers and sellers. What a great opportunity to generate more business!

The key component to qualifying for home purchase is a sizable down payment. There is no income or credit qualification because the new owner will not have any mortgage payments to make.

It is very important for the Real Estate Agents on both sides of the transaction to know the HECM for Purchase Guidelines. The transaction is different from conventional purchases. The purchase agreement must be setup properly at the beginning. Understand what is necessary before the offer is submitted. Provide documentation that is legible and specified in the guidelines.    This will assure the transaction will be successful and save everyone involved from delays. For properties in California and Nevada, you are encouraged to call Maggie O’Connell at the initial stages of interest from prospects who are at least 62 years old and have substantial down payment funds.

(800) 489-0986 ReverseMortgageStore.com

HECM for Purchase Guidelines

(updated 5-26-09)

The property must be an eligible HECM property and must be single family residences only, no 2-4 unit properties qualify. Construction must be completed and property ready for occupancy. The borrower must occupy the home within 60 days of closing.

The maximum claim amount will be the lower of the actual sales price, appraised value or FHA maximum loan limit.

The required monetary investment is the difference between the principal limit and the sales price plus the total of the HECM closing costs and the servicing set aside amount.

The borrower may provide a larger monetary investment in order to retain some HECM proceeds for future draws.

If a gift is being used, a gift letter, evidence of donors ability to provide gift and evidence that funds have been transferred into Borrower’s account prior to closing or a certified check showing remitter is required.

We must Verify Funds from mortgagor. Funds for purchase must be borrower’s own funds for the required monetary investment. Including cash on hand or proceeds from sale of home or assets. A verification of deposit along with original bank statements that cover the most recent 3-month period and previous month’s balance are used to verify savings and checking accounts. and certified check bearing the name of the borrower can be used to verify funds from the sale of a home. A wire transfer statement showing Settlement Agent as sender and Borrower as recipient can also be used.

Earnest Money Deposit must be verified and a copy of the HUD-1 and executed Purchase Contract provided.

Ineligible Funding Sources include; gifts, credit card advances, bridge loans, personal loans, subordinate liens, loan discount points, interest rate buy downs, closing costs assistance, builder incentives, gifts or personal property given by the seller or any other party, seller concessions or financing, loans against borrower assets, down payment assistance programs are prohibited.

Allowable Fees must be typical for the market. Costs associated with the HECM loan must be paid by the buyer. Seller cannot pay pre-paid costs. Taxes and HOA fees must be prorated. Seller can only pay the transaction costs (transfer tax, real estate commissions, title search, etc.) typically paid by the seller.

Counseling Certification: All borrowers, non-borrowing spouses and attorney-in-facts must receive counseling and the certification must reference the subject property being purchased and to be provided to the loan originator prior to opening escrow.

Origination Fee is up to 2% of the first $200,000 and 1% thereafter of the Maximum Claim Amount subject to a minimum origination fee of $2,000 and a maximum origination fee of $6,000. 100% of closing costs are allowed to be financed into the loan amount.

Servicing Fee varies by Product and an amount sufficient to fund the servicing fee for the duration of the mortgage must be set aside.

A Contract of Sale, fully executed with all changes initialed must be provided. The following must be included in the Contract of sale:

            -FHA Amendatory Clause

            -FHA Real Estate Certification

-Contingency for a satisfactory Home Inspection conducted by a qualified Home Inspector

-Language indicating Seller is responsible for completing and paying for structural repairs that affect the safety and soundness of property prior to closing.

-It is recommended to include a Mortgage Contingency

Closing must take place in the Settlement Agent’s office.

Property Flipping is not allowed and lenders must take the following additional steps to ensure that the borrower has not been coerced into obtaining a reverse mortgage:

-Confirm only current owners of record may sell properties that will be financed using FHA-insured mortgages

-Any resale of a property may not occur 90 or fewer days from the last sale to be eligible for FHA financing and;

-For re-sales that occur between 91 and 180 days where the new sales price exceeds 100% of the previous sales price, additional documentation validating property’s value must be obtained.

Inter-Vivos trusts and life estate that meet guidelines are acceptable. See HUD Guide for special restrictions/ requirements.

Mortgage Insurance Premium (MIP) is required on all loans and is non-refundable.

            -Initial MIP is 2% of maximum claim amount (may be financed or paid in cash)

-Monthly MIP is 1/12^th of .5% (of outstanding balance) is added to principal monthly

All Title Holders must be eligible Borrowers. Borrower cannot change title to property after receiving a HECM loan.

Only one FHA Insured Loan per borrower at a time. Therefore, if any of the Borrower’s existing real estate holdings are secured by an FHA mortgage, they must be paid off at or prior to closing.

This is a non-recourse loan.   The borrower or their estate will never owe more than the loan balance aor value of the home, whichever is less.

The following documents are required from the borrower at or soon after application:

The Contract of Sale must include:

            -Amendatory/Escape Clause

            -FHA Real Estate Certification

- Contingency for a satisfactory Home Inspection conducted by a qualified Home Inspector

-Language indicating Seller is responsible for completing and paying for structural repairs that affect the safety and soundness of property prior to closing.

Documentation required:

Counseling Certificate (original and signed and dated)

Verification of Social Security Card (legible copy of Social security card or medicare card)

Acceptable Photo ID

Proof of Age (legible copy)

Trust Agreement (if property is held in a trust)

New Homeowners Insurance Policy (and flood if needed)

(see required monetary investment and verification of funds for documentation of money from buyer/borrower)

Important Reverse Mortgage Update!

Reverse Mortgage Store — Mon, 30 Mar 2009 14:20:59 -0500

If you are in the market for a reverse mortgage, I can't stress enough the importance of getting the process started now. With the announcement on margin increases by Fannie Mae, it is extremely important to secure a reverse mortgage before interest rate indexes start moving up. A higher expected interest rate results in lower cash available, lower credit lines and lower monthly income amounts to you. Also, the high maximum claim amount is good only through 2009, and there will be a rush of loans going through at the end of the year. So don't miss the boat!

Contact us for FREE information and advice at the reverse mortgage store today!

HECM Limits to go to $625,500!

Reverse Mortgage Store — Wed, 18 Feb 2009 13:27:25 -0600

As at the time of writing, the President has signed the Economic Stimulus package, part of which includes the provision for the HECM limit to increase to $625, 500 for the balance of 2009. THis is great news for homeowners in higher value homes as they can get more value from their home equity.

Visit us at reverse mortgage store for more information!

The Best Time to Get a Reverse Mortgage is When Interest Rates Are Low

Reverse Mortgage Store — Tue, 16 Sep 2008 11:30:24 -0500

Age is one factor in determining the amount available from a reverse mortgage. The best age to get a reverse mortgage depends on various factors. Is there an existing mortgage with payments that create a financial strain on the budget? What is important to the individual or couple, making the most out of life or retaining the most equity as possible for their heirs? Is your existing financial situation fine at this time and do you want to preserve your equity for later years when financial needs may be greater? The best time can only be determined by you and perhaps your family and your current financial status, your future needs, your concerns and personal attitudes and beliefs. If you are ready, we are approaching a great time to get a reverse mortgages as interest rates are declining and the lending limits will be increased soon.

I hear from people want to wait until they get older to get a reverse mortgage for the simple reason that reverse mortgage calculations provide more money at an older age. This strategy on the surface makes sense but this strategy could backfire as there are other factors in play to determine the amount available from a HECM reverse mortgage. The three factors in determining the amount available from the HECM reverse mortgage are age of the youngest borrower, current expected interest rate and appraised value of the home or FHA maximum claim amount, whichever is lower. Many people are not aware how dramatically the loan amount is affected with just a one point increase in the interest rate. It could be very disappointing to wait and find the amount available is dramatically lower after waiting a few years. Below is an example based on the amount available to a borrower at age 65 at the expected interest rate (current, and age 68 at one point higher and two points higher. Notice the amount available, whether lump sum or monthly stipend is dramatically lower when calculated at a higher interest rate.

Age                  Home value               Rate                             Lump sum/LOC or Monthly Stipend

65                    $350,000          5.56%                          $207,000                     $1,180

68                    same                6.56%                          $168,600                     $1,077

68                    same                7.56%                         $136,500                     $969

The reason less money is available with the higher interest rate is because of the way a reverse mortgage is structured, in that payments are not made over the life of the loan. At a higher rate the lender assumes the balance will increase more rapidly, therefore they provide less money initially.

Let's look at an example with the home value appreciating to $417,000 by the time this borrower is age 68 but the rate is 2 points higher. (assuming the FHA maximum claim amount will be $417,000 by then). The amount available is $164,000, still much lower than the amount today at the current rate. But with the increased value, closing costs increase by $1,100. So waiting created less money available to the borrower but added more to the loan balance in fees because of the higher value. We don't know what interest rates or home values will be in the future, but we do know what is available today. And interest rates are at near historical lows. The best strategy may be to take out the reverse mortgage now, even if you don't need the money until later because you can leave the money in the line of credit which will increase at the same interest rate that's charged on the balance, so you can be certain the amount available will be higher in the future. This strategy minimizes the guesswork in timing your reverse mortgage transaction.

Other advantages of doing the reverse mortgage when rates are low is a lower cap on the adjustable rate reverse mortgage and if a fixed rate reverse mortgage works well for you, the low rate will certainly preserve equity for your heirs when the loan becomes due.

On the date this article was written, the Housing and Recovery Act of 2008 has been signed into law, but not yet implemented. Many prospective reverse mortgage borrowers with high value homes are waiting for the lending limits to increase, and for good reason. The increased limits will provide more money and the current economic situation does not indicate interest rates will jump over the short term. Let's hope home values don't slide before the new FHA lending limits are implemented. If your home value is within the current lending limits, your best bet is to do the reverse mortgage now.

Written on 9/16/2008 by: Maggie O'Connell, maggie@rmstore.net www.ReverseMortgageStore.com &      www.ReverseMortgagesofNevada.com

Disclaimer: Reverse Mortgage Store Blog does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied. Blog posts on the Reverse Mortgage Store Blog represent the opinions and ideas of the author(s). Reverse Mortgage Store Blog does not express the views of Reverse Mortgage Store or those of the broker.

How the Housing Recovery Act, HR 3221 helps senior homeowners through FHA Reverse Mortgages

Reverse Mortgage Store — Sun, 17 Aug 2008 17:38:53 -0500

The housing and credit crisis of 2008 doesn’t limit its impact to speculators and risk takers. Senior homeowners have also been impacted. Home equity represents a large portion of net worth for the older set. Often, people sell their family home and downsize after retirement. But, in many areas of California and Nevada with home prices realizing dramatic reduction as we enter the fall of 2008, selling a home at this time may not be a good option or may not be an option at all! That’s where the reverse mortgage comes in. You can stay in your home, pull cash out and you don’t have to make payments (but you can if you want). We’re all waiting in anxious anticipation for HUD to announce exactly when, where, how and what the new lending limits will be. We do know there are exciting advances with reverse mortgages that will help more people get more money and enjoy more financial security. We do know the lending limits will increase soon. Many people with existing reverse mortgages will be able to refinance and have more money available, especially if they live in an area that had reduced lending limits up to now. Stay tuned to see what the new limits will be. Up to now, you could only get a reverse mortgage if you already had title to the home. With the new bill, people will be able to purchase a home using a reverse mortgage for financing. A larger down payment that standard financing is required (because no payments are required over the life of the loan). Since we are in a buyer’s market, this is a great opportunity for older people to purchase a new home. Reverse mortgage financing will also be available on Co-ops. The bill puts a cap on the origination fee a reverse mortgage originator can charge. But with the increasing limits and the 2% HUD charges for mortgage insurance, the loan is still costly in terms of up front fees (but no out of pocket fees). It is worth the cost over the long run when it helps maintain a comfortable lifestyle. I’ve always been adverse to cross selling financial products with reverse mortgages and I’m glad to see it has been addressed in the FHA Modernization Act that is part of this large housing bill, although there seems to be some contradiction on the bill. One paragraph strictly prohibits an individual from cross selling a financial product using HECM proceeds, if they receive financial incentive for the sale of the financial product and the reverse mortgage. However the second paragraph indicates that this maybe permissible if a lender has “safeguards and firewalls.” HUD lawyers are working on this but they way I see it, the reverse mortgage works well on it’s own. If you are interested in other financial products, that’s your business. Get your reverse mortgage through a knowledgeable reverse mortgage specialist (I know a good one if you are in California or Nevada), and get rid of mortgage payments, or get a monthly income or establish a line of credit for the future. And you know it’s safe! by Maggie OConnell www.ReverseMortgageStore.com 800-489-0986

California Reverse Mortgage - adding the personal touch to podcasting

Reverse Mortgage Store — Mon, 11 Aug 2008 18:27:30 -0500

Music and reverse mortgage recordings - adding that personal touch? In this recording, I add in my piano playing as background to some recorded client testimonials and reverse mortgage discussions. It adds that 'personal touch'- what do people think?

Click here to visit and listen!

Reverse Mortgage fees and issues podcasts- I discuss commonly raised questions and concerns

Reverse Mortgage Store — Thu, 07 Aug 2008 16:15:50 -0500

Hi there,

Click here to visit and listen!
On this podcast, I discuss one of the comonly asked- about fees regarding reverse mortgages - the servicing set-aside fee. I explain what this is and how it works. Keep watching for further recorded discussions on other fees.
Click here to visit and listen!
This podcast answers a commonly raised concern - how does a reverse mortgage affect my family inheritance? Here, I address that concern and hope it assists any of you listening too.
listen to more testimonials, recordings and podcasts subscribe to the feed !

Reverse mortgage client uses her money to help daughter with a house downpayment...

Reverse Mortgage Store — Tue, 29 Jul 2008 16:18:53 -0500

Hi there,

Click here to visit and listen!
The above recorded client testimonial outlines how this client used her reverse mortgage to provide a home downpayment for her daughter. A very interesting use for a reverse mortgage - to be more common, perhaps, now lenders are more likely to ask for downpayments?
listen to more testimonials and podcasts that I have recorded and subscribe to the feed !

Reverse Mortgage Interest Rates - Updated Weekly!

Reverse Mortgage Store — Mon, 28 Jul 2008 18:19:31 -0500

FHA HECM REVERSE MORTGAGE RATES

ARM ( 2.50% LIBOR margin rate)
for week of December 15, 2009
2.73%

Fixed
as of December 15, 2009

5.56% - 7.125%

We broker reverse mortgages offered by these major lenders:
Everbank, Bank of America, Financial Freedom (Indymac),Metlife

*Note: Rates change daily and differ between lenders plus there is an additional 0.5% mortgage insurance on ALL options: Contact us for further information and to request a TALC for total costs. Visit us for more information on reverse mortgages!

FHA HECM REVERSE MORTGAGE RATES
ARM ( 2.50% LIBOR margin rate) for week of December 15, 2009	2.73%
Fixed as of December 15, 2009	5.56% - 7.125%