Recent Changes and Improvements in the Reverse Mortgage Field
I have spoken to many professionals who tell me that they know all they need to know about Reverse Mortgages. When I ask them when they were last informed about them, many tell me that they last learned about them over a year ago. The truth is that the industry has seen a TREMENDOUS change in the last 12-18 months. here are some examples:
1) In 2006 there were three products avaliable. There are now almost 100. The biggest changes are to the non-FHA products (called "Propietary" or "Jumbo") but there are many new advancements to the FHA products.
2) Treasury and LIBOR rates have come down so low that many borrowers are now qualifying for much more money available to them than before.
3) Reverse Mortgages are now availble to homeowners who are 60. The age minimum used to be 62, but there are two lenders out there who will lend as low as 60. The products are not great (and will probably improve), but they are better than nothing.
4) FIXED RATE REVERSE MORTGAGES ARE NOW AVAILABLE! (in fact they are becoming very popular)Both the HECM (FHA's Home Equity Conversion Mortgage) and the Jumbo products are available as a fixed-rate loan. This was a big knock on the Reverse Mortgage before. Some lenders put limitations on the fixed-rate product, such as taking the entire balnace at closing.
5) Jumbo Reverse Mortgages can now be used for Purchases, Co-op's and even second homes. Two years ago, these were unheard of.
6) The entire loan process can be done over the phone. Six months ago, either the application or the counseling session had to take place in person. For many borrowers, this was a big burden. Now, both can be done over the phone.
I am guessing that I am forgetting some of the other changes, but this was a good start.
Comments(2)