The New Reverse Mortgage: Past & Present

By
Mortgage and Lending with Fairway Independent Mortgage 618401
https://activerain.com/droplet/57X9

The New Reverse Mortgage: Past & Present

To some, the mere mention of a reverse mortgage brings negative emotions from a distant experience with a loved one. To be fair, reverse mortgages of the past have indeed earned some of the negative publicity associated with them, but this mortgage product has many half-truths and misconceptions perpetuated by the media. Today's reverse mortgage is much different and provides many safeguards that greatly benefit the consumer.

History of the Reverse Mortgage

The very first reverse mortgage was written in 1961 in Portland Maine by Deering Savings & Loan. Many years later, the first congressional hearing in 1983 began. The Senate approved a proposal by Senator John Heinz to have reverse mortgages insured by the Federal Housing Administration (FHA). Ronald Reagan signed the reverse mortgage bill into law in 1988, and the government insured loan was established. The HECM (Home Equity Conversion Mortgage) reverse mortgage lender participation is at its highest number at 195 since inception.

Fast forward to the year 2008, and we begin to see the first of the baby boomers reach age 62. The reverse mortgage production exceeds expectations in the number of originations. This is partly due to the sheer number of baby boomers retiring and the fact that in 2008 we entered an official recession aptly name the Great Recession. The stock markets are down which means 401(k)'s are down. These boomers are looking for ways to supplement their income without withdrawing their retirement funds.

In 2009 the first reverse mortgage purchase program was born where borrowers can purchase a home and never have to make a mortgage payment. In 2013 and 2014, the reverse mortgage product underwent several changes that resulted in the product becoming safer and less risky for the borrower. The Financial Assessment was implemented in 2015 which requires the borrowers to undergo a credit and income assessment and may require the borrower to have a "Life Expectancy Set-Aside" account (LESA) to pay for property taxes and homeowner's insurance.

Some of the bad press that the reverse mortgage has garnered has been from many elderly homeowners's not paying their property taxes, and insurance and the lender have to foreclose on the loan. The reverse mortgage is no different than a forward mortgage in that regard. Paying property taxes and homeowner's insurance has always been the responsibility of the homeowner yet somehow the media portrays the lender in a negative light for not "disclosing" this information to the homeowner. If you own real estate, you will always have that responsibility. To do otherwise is merely financial mismanagement.

The Present Reverse Mortgage: Who Is It For?

  • Age 62 Or Older
  • FHA-Qualified Home Must Live In Home More Than 6 Months A Year
  • Generally, Won’t Affect Social Security and Medicare Benefits- Consult your tax advisor

Reverse Mortgage Benefits

  • Keep The Title To Your Home*
  • Basic Credit & Income Qualifications
  • Loan Proceeds from Equity 45-75% are Usually Tax-Free**
  • Never A Monthly Payment – Still Responsible For Maintenance, Taxes, And Insurance As Long As They Occupy Their Home
  • Does NOT Require Repayment Until*** The Last Living Borrower Permanently Leaves The Home
  • Borrower Chooses To Sell The Property
  • Never Owe More Than Home Value - With FHA-Insured Reverse Mortgages
  • Able To Purchase A Home For 35-55% Down of New Residence Sale Price****

For more information on reverse or forward mortgages please feel free to contact me through activerain or my website at GreenvilleSC.mortgage

*some circumstances will cause the loan to mature and the balance to become due and payable. The borrower is still responsible for paying property taxes, insurance and maintenance. Credit is subject to age, property and some limited debt qualifications. Program rates, fees, terms, and conditions are not available in all states and subject to change. **This advertisement is not tax advice. Please consult a tax advisor for your specific situation.

***Heirs will have six months with two 90-day optional extensions to either refinance the home if they want to purchase it at 95% of the appraised value; keep any net proceeds; or walk away if the property is upside down. ****Percentage of down payment required will is determined by borrower’s age, interest rates, and the lesser of the home’s appraised value or purchase price.

NOTE: Some circumstances will cause the loan to mature and the balance to become due and payable. The borrower is still responsible for paying property taxes, insurance and maintenance. Credit is subject to age, property and some limited debt qualifications. Program rates, fees, terms, and conditions are not available in all states and subject to change.

Posted by
Fairway Independent Mortgage Corporation
John Nunnally
Mortgage Loan Originator
NMLS ID 618401

300 E Coffee St, Suite 100
Greenville, SC 29601
Mobile 864-809-3700                   
                  
Fax 866-318-8259

  johnn@fairwaymc.com
www.greenvillesc.mortgage

Confidentiality Notice: The information contained in and transmitted with this communication is strictly confidential, is intended only for the use of the intended recipient, and is the property of Fairway Independent Mortgage Corporation NMLS #2289 or its affiliates and subsidiaries. If you are not the intended recipient, you are hereby notified that any use of the information contained in or transmitted with the communication or dissemination, distribution, or copying of this communication is strictly prohibited by law. If you have received this communication in error, please immediately return this communication to the sender and delete the original message and any copy of it in your possession.

SC License Number MLO-618401

                

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Lending / Financial
Location:
South Carolina Greenville County
Tags:
reverse mortgage
hecm

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainmaker
1,346,308
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Los Angeles CA

Welcome to the Rain! 

Congratulations on your first blog post.

Oct 30, 2017 10:49 PM #1
Rainmaker
1,484,540
Sybil Campbell
Long and Foster REALTORS® 5234 Monticello Ave Williamsburg, Virginia - Williamsburg, VA
REALTOR® ABR, SFR, SRES Williamsburg, Virginia

Hi John Nunnally, Welcome to Active Rain and congrats on your first blog post. This is a great place to meet and interact with awesome professionals.

Oct 31, 2017 01:56 AM #2
Rainmaker
1,173,991
Kat Palmiotti
Grand Lux Realty, 914-419-0270, kat@thehousekat.com - Monroe, NY
The House Kat

Welcome to ActiveRain! 

Thank you for the overview of the current reverse mortgage product. I look forward to reading more from you.

Oct 31, 2017 02:58 AM #3
Rainmaker
2,453,235
Richard Weeks
Dallas, TX
REALTOR®, Broker

Welcome to Active Rain.  I know ou will enjoy your time here.

Oct 31, 2017 04:52 AM #4
Ambassador
3,469,963
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

John Nunnally welcome to ActiveRain and congratulations on successfully posting your first blog on this site.

Nov 01, 2017 09:12 AM #5
Rainer
111,788
David A. Weaver
Peoples Bank & Trust Co. - Scottsdale, AZ
24 years helping folks finance their dreams.

Welcome to the Rain, congratulations on your first post.

Nov 02, 2017 05:35 PM #6
Ambassador
3,391,492
Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams fox cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Thanks John,

Welcome to Active Rain, looking forward to reading many more of your posts, let me know if there is anything that I can do to help as you get started here.
All the best of success to you.
Bob

Nov 09, 2017 09:37 PM #7
Rainmaker
3,522,127
Joan Cox
Metro Brokers - House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

John, great information for those borrowers interested in a reverse mortgage.  Welcome to ActiveRain.  

Nov 10, 2017 07:19 AM #8
Rainmaker
1,346,308
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Los Angeles CA

Yes, many of us here daily, learning, sharing, supporting each other. What do you think of this community?

Dec 30, 2017 07:23 PM #9
Rainmaker
1,346,308
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Los Angeles CA

btw...Sometimes, RM is the only solution.... especially to avoid a foreclosure. Also, if a homeowner needs help with manging their delinquent property expenses. There expenses include property taxes and homeowner's insurance, as well as up to 12 months of additional assistance for future property expenses. 

Dec 30, 2017 07:29 PM #10
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
7,106

John Nunnally

Close in as Little as 10 Days
Need to Close Quickly?
*
*
*
*
Spam prevention