Thursday, December 12, 2013

The Reverse Mortgage Explained In Under 100 Words

A reverse mortgage allows you to access a portion of your equity payment free as long as you live in your home. If you’re on a fixed income a reverse mortgage can help to supplement your retirement like no other product out there.  To qualify you must be 62 or older and have enough equity, plus your home needs to pass an FHA inspection.  Visit our reverse mortgage details page for up to date info and our calculator page to get pre-qualified.  For more questions call 1-800-431-9250 to talk with a representative!

Friday, November 15, 2013

Qualify For A Reverse Mortgage On Your Smartphone!

Utah seniors use smartphone and tabletsMost people including many Utah seniors agree the internet is a great place to research any product or service. There is so much information you can get with just a few clicks of your mouse on any subject you desire. Over the past 5 or so years as the smartphone and more recently the tablet have grown in popularity substantially, and more internet searches are moving away from the traditional computer to these new devices.  In fact in India more people use the internet with mobile devices than on computers and we here in the US are not far behind.

So what does this mean to Utah seniors?  Well if you are deciding if a reverse mortgage is the right fit for you or not chances are you will do some research on the internet.  If you have a smart phone or tablet it's nice to have a website you can actually read on a smaller device.  If this is you; we have some good news!

Reverse Mortgage USA's Utah branch in Alpine Utah has just launched an updated version of their popular website reverseutah.com with a smart, responsive design that looks good on any size of device.  The website has a clean and refreshed look that is easy to navigate through. The website also has a calculator on the home page as well as a dedicated calculator page that responds to the device you're using to make it easy to not only learn about the reverse mortgage program while you use your smartphone but also see what you qualify for as well.

If you're in the marketing for a reverse mortgage or know someone who is, pull our your smartphone or tablet and check out the new reverseutah.com.  You'll be surprised how easy it is to get educated on the reverse mortgage program.

Wednesday, October 9, 2013

3 Reasons To Get A Reverse Mortgage Before The End Of The Year

3 reasons to get a reverse mortgage
If you're a senior living in the State of Utah you've probably seen the TV commercials, gotten a post card in the mail, or maybe even spoken to someone about the reverse mortgage program.  If you haven't taken advantage of it, the next 2 1/2 months may be the last good opportunity.  In fact, you may not even qualify by the end of the year! So if you're looking for a good reason to get a reverse mortgage right now: here are 3 of them.

Reason #1: More Changes

The changes that were mandated in the Reverse Mortgage Stabilization Act of 2013 have partially been enacted by lowing the amounts you can qualify for, but the biggest change has yet to happen. Many seniors get a reverse mortgage because of the ability to access some money without the need to make a payment. The reverse loan has a reputation of being a loan of last resort, but there are a surprising number of people who get it and don't really need it, they just like having access to their equity because they don't know what the future will hold.

Starting in January 2014 all reverse mortgage applicants will be required to take a "means" test.  The means test is supposed to show how much the borrower needs the loan as well as their ability to keep up on house repairs, taxes and insurance.  If the borrower doesn't really need the money, then they will not be able to qualify for as much if any.  If you don't want "big brother" to tell you what you can do with your own money, then getting started on the reverse mortgage by the end of the year is the thing to do.

Reason #2: Increasing Property Values

After the financial crisis started a few years ago everyone's property values took a hit.  If you have looked at a reverse mortgage within the past few years and didn't qualify, you may now!  The median home prices in Salt Lake County have gone up 17% from last year and you may be surprised to see how much your home is now worth.  Websites such as Zillow.com can be a good option to see how much your home has increased in value.  Once you have an idea, try our free reverse mortgage calculator to see if you qualify.

Reason #3: The Holidays

No this is not like the commercials you see on TV saying to get a reverse mortgage and then go on a cruise or vacation and blow all your money.  In fact we recommend you don't use the money from the reverse on things like that.  Why the coming holidays is a good reason to get a reverse mortgage though is to save you money.  How many of us on a fixed income end up buying gifts on a credit card and then take most of the next year to pay it off just in time to do it all again?  Well by getting a reverse mortgage you will have your current mortgage paid off thus eliminating the monthly payment and increasing your cash flow.  With this new monthly cash flow you can purchase presents and maintain your holiday traditions without loading up your credit cards.  With a traditional mortgage or a reverse mortgage you accrue interest that needs to be paid; but by following this plan you now stop accruing credit card interest as well...saving you money!

If you have been considering a reverse mortgage, or know anyone who has, please share this post and also our website reverseutah.com.  We will be happy to go over all the reverse mortgage options with you and make sure your questions are answered. Want to talk to someone live?  You can also call us toll free at 1-800-431-9250.

Tuesday, August 20, 2013

Reverse Mortgage Changes - They are-a-coming!

government changes reverse mortgage programWhen was the last time the government made changes that resulted in something better for the consumer long term?  Can't think of any?  Either can I. Over the past year there have been some big changes to the reverse mortgage program in effort to "shore it up" but thanks to the Reverse Mortgage Stabilization Act of 2013 you ain't seen nothin' yet!  If you're on the fence about getting a reverse mortgage or not check out this post from the great blog reverse mortgage daily.


The reverse mortgage industry and the Department of Housing and Urban Development are beginning to shed light on the changes that are in store for the Home Equity Conversion Mortgage program following approval for program change granted by Congress this month.
HUD Deputy Assistant Secretary Charles Coulter explained the proposed changes, without providing full details which are still being worked on at HUD, in a recent conference call with the National Reverse Mortgage Lenders Association’s executive and policy committees.

HUD is planning to create a new reverse mortgage loan program, while discontinuing the two programs—the Standard and Saver—as they are currently offered, according those familiar with the details. The new loan will come with new principal limit factors that range somewhere between the current Saver and Standard programs, though details have not yet been released on exactly where on the scale the new PLFs will fall.
Officials have stated to Congress and the public that the desired changes will shore up the FHA’s insurance fund for its HECM program and will also make the products safer and more sustainable for borrowers.
While additional program changes have been discussed, including a financial assessment of borrowers and a set aside for property tax and insurance payments, those changes are not expected to come in the first set of product changes, rather they are expected to be released in the coming months.
The new product will come with new mortgage insurance premiums that are dependent upon the amount that is drawn upfront and whether that amount  falls under or exceeds a 60% threshold. Only borrowers with mandatory obligations will be able to exceed that threshold.
Details are expected from HUD some time before September 1. The agency has stated it would like to implement the changes before October 1, 2013.
Written by Elizabeth Ecker, Reverse Mortgage Daily


Want to look again at the reverse mortgage program?  Call 1-800-431-9250 to talk to a specialist or visit www.reverseutah.com.

Wednesday, July 24, 2013

Reverse Mortgage | Timing Is Everything

There is a popular saying that "Good things come to those who wait".  While this is true for somethings it's not for reverse mortgages.  There has been a lot of news lately about changes in the reverse mortgage program that are coming down the line.  For most reverse mortgage customers these changes will not be a good thing so literally, if you've ever considered the reverse mortgage or know someone who has...NOW IS THE TIME!  If you wait much longer it may be too late.

Currently the reverse mortgage allows a borrower over 62 years to access a portion of the equity in his home without any payment due for as long as he lives in the house.  In order to get the loan, you have to be old enough, have enough equity, and the home has to pass an FHA inspection and be your primary residence.  If all these things check out then you can take the money you qualify for in either a lump sum, line of credit, or a monthly payment to you.  With the increasing numbers of baby boomers retiring the reverse mortgage option has been gaining popularity over the past few years.

So why is now the time to get a revere mortgage as opposed to next year, or even 5 years from now?  The answer has to do with property taxes and homeowners insurance.  The reverse mortgage is an FHA insured loan; meaning if the borrower defaults or if the loan goes bad then the FHA will step in and help cover the losses.  Because the reverse does not require a monthly payment, the only way to default on the loan is to not pay your property taxes or insurance; which is exactly what is happening at a fairly large rate!

Most mortgage companies collect money for property taxes and insurance every month when you make a payment.  When a senior gets a reverse mortgage if they've been used to having the mortgage company collect and pay for these bills can easily forget about them. Unfortunately this is happening and about 10% of reverse mortgages are now in default for the borrower not keeping taxes and insurance current.  Also many borrowers when they take out a reverse are having all the money they qualify for be issued in a lump sum.  This is their choice, but if they run out of money too quickly then paying taxes and insurance my be a bigger burden.

So like with anything that government is involved in that's not working right, the government feels it necessary to come in and fix it; which is exactly what is about to happen with reverse mortgages!  The proposed changes have passed the House and are currently on the way to the Senate and if they stay as they are I will repeat myself again...Now is the time to consider the reverse mortgage!  Some of the changes will be credit based, meaning if you don't have good credit you can be turned down!  There is also talk of a "needs assessment" which would take a look at your income and assets and if you don't really need the loan based on government guidelines then you will be turned down. If you do still qualify after you have jumped through all the hoops then their is a chance the lender will be forced to hold back a certain amount to help cover taxes and insurance should you fail to keep them current.  Bottom line; the equity in your house which is your money is going to be harder and harder to get access to.  So if you've ever thought about a reverse mortgage but decided to wait a few years until you need it more, or are just on the fence its time to take another look.  To get more details on the proposed changes call 801-372-9636 or visit www.reverseutah.com.

Wednesday, July 3, 2013

Rising Interest Rates and Reverse Mortgages

If you have been watching the news you have seen that mortgage interest rates have been rising lately making it harder for people to qualify for as much money.  Many people have been asking recently how the rising conventional mortgage rates have effected the rates on the reverse mortgage. The short answer is they haven't...yet!

The interest rates on reverse mortgages usually lag behind conventional rates by a few months, but there are rumblings on the secondary market that investors buying reverse mortgage loans have not been quite as excited as of late.  What will make them more excited?  MONEY!  How do they make money?  With higher interest rates.

If you are reading this and have considered the reverse mortgage, now is the time to look again.  Values in Utah are finally going up so this is the perfect time to revere your mortgage before interest rates follow suit.  You can see if you qualify by using our free reverse calculator, or calling 1-800-431-9250 today.

Monday, May 27, 2013

Take a Moment

Happy Memorial Day!
 
From all of us at Reverse Mortgage USA in Alpine, Utah we wish you a Happy Memorial Day 2013. Please take a moment to remember those who have died serving others.

Monday, May 13, 2013

Can you turn home equity into retirement income? John Gin's MoneyWatch (via Nola.com)
The long-struggling housing market is finally showing signs of recovery, giving many homeowners more equity in their properties. This encouraging trend is likely prompting more pre-retirees to consider if, and how home equity can be turned into a source of cash to help fund their retirement. There…

Friday, May 10, 2013

Learning About The Adjustable Rate Reverse Mortgage

We all know that the end of March 2013 meant that end of the traditional fixed rate reverse mortgage program.  There are different reasons why this was done, but the biggest was the FHA is loosing money and this was one of a couple ways to help.  Now without this program seniors are left with only one way to qualify for close to the same amount of money they would have just a few months ago; it is the traditional adjustable rate reverse.

Fixed vs. Adjustable

The reason why the old fixed rate program was so popular was because it was a fixed rate.  Seniors today lived though the 70's and 80's and the crazy high mortgage interest rates and when you say adjustable the only thing most people think is adjusting UP.  While rates going up is not always the case, it is pretty easy to guess that because we are currently at historic lows, up is the only likely place for rates to go long term.

The nice thing about the reverse mortgage is the rates of tomorrow don't matter the same way to you once you have closed on the loan because you have no payment.  Rates could skyrocket (although there are now caps in place to limit how high they can go with your loan) but increasing rates would not affect the money you have coming to you from the reverse mortgage; rising rates just effect the remaining equity you have in your home.  If you are planning on living in your home until you die then an adjustable rate should not matter to you at all.  If you are set on leaving your home with some equity to your family if possible, then you may want to consider the saver program where a fixed rate is still possible.

Differences

Besides the adjusting interest rate there are a few differences you should be aware of compared to the fixed rate program.  With the fixed rate you were required to take your proceeds in a lump sum; the adjustable loan gives you options to take it all at once, put the money in a line of credit, turn the money into a monthly payment, or a combination of all 3.

  • The line of credit option is an increasingly popular option for seniors because like any credit line, you only pay interest on the money you borrow.  Another advantage of the line of credit is the line grows the longer you have it.  There is some crazy formula that is used to determine the growth rate, but it is similar to a cost of living increase with social security, the line gets a little bigger each year.  One downside with the line of credit is you still don't have all your money, your not totally in control.  If the economy takes a nosedive the bank can just freeze the line...then what good it it to you?
  • The monthly payment used to be the most popular way reverse mortgage proceeds were taken by borrowers.  This option has declined in popularity as more and more people want to be in control of their money and not have to rely on the bank to send them a little bit every month.
  • The last way and still the most popular way to get your reverse mortgage proceeds is the lump sum. By taking the lump sum you get all your money now and then are in control to use it how and when you want.
Conclusion

So there you have it.  The adjustable rate reverse mortgage is now the only way to qualify for the most money.  There are a few more moving parts to this loan, but it shouldn't be something to be scared of or shy away from.  If you are in the market for a reverse mortgage this option should be considered every bit as much as the fixed rate loan was.

Monday, April 8, 2013

Can You Default On A Reverse Mortgage?

One of the many misconceptions about the reverse mortgage program is that once you have one, all your payments are done.  While this is true about mortgage payments, this is not true about all your payments.

The reverse mortgage allows seniors who are 62 and older who have enough equity the opportunity to refinance their current mortgage onto the HECM program and get rid of their monthly mortgage payment.  There is no income, asset, or credit needed to qualify; your eligibility is based off of 4 things, your age, equity, occupancy (the home must be your primary residence), and type/condition of the house.  As long as you meet these conditions you can get a reverse mortgage and never have to worry about a monthly mortgage payment again.

Most people think that there is no way to default on a loan that requires no payment.  While that makes sense, with the reverse mortgage that is not the case.  This program requires no monthly loan payment to the bank, but if you don't pay your property taxes and insurance you have technically defaulted on the loan and the lender can foreclose.  Currently about 58,000 seniors with a reverse mortgage or approximately 1 in 10 are in default for not staying current on taxes and insurance.

For most people with a reverse mortgage the program is a lifesaver; allowing them to now fully retire!  This is the reason the program was created, but if you are considering a reverse; please remember YOU STILL OWN YOUR HOUSE!  You still have to maintain the property, and keep taxes and insurance current.  If you get a reverse mortgage, you have not sold your home to the bank or the government, it along with all the responsibilities of ownership along with the equity are yours.

Monday, February 18, 2013

Social Media and Seniors

Senior couple using the computer
According to the AARP more than half of seniors age 65 and older are online and 1/3 of them use social networks.  So if you think you're too old for social media, think again; survey after survey of elderly Americans, even those in the oldest age groups are participating in, loving it, and finding it very useful.  Here are just a few of the many benefits of social media for seniors.


Keeping Families Close

How many people love to hear from their children and grandchildren?  While you would think because almost everyone has a cell phone these days it would be easier than ever to get a hold of people, but unfortunately that's not always the case.  Social media provides a great option for seniors to both keep in touch and keep up to date with family members both close and far.

Sharing Photos and Videos

Traditionally when someone would takes a picture before they could send it to a family member; they would have to go get it devolved which could take a few hours to a few days, then send it in the mail to the person which usually takes a couple days.  The whole process can take a week or more.  Now with digital pictures and videos parents can literally take a picture or video of their kids and post it on Facebook for the grandparents within a mater of seconds.  What a great way to create a feeling of closeness never before possible with mailed pictures.

Discounts

The blog senior care corner recently had a post about this very subject and said the following: Everyone likes saving money, not just seniors, though for many older Americans on fixed incomes getting a deal is essential and not just a fun thing to do. Social media provides access to many opportunities to save money, whether it’s discount offerings by companies on their Facebook pages, coupons shared between Twitter users, or the deals offered in many communities on Groupon, just to name a few. Not only can going social be fun, but profitable as well.

There are many other ways social media can benefit seniors, but before you can really understand, you just need to try it!  Computers, the Internet, and social media can be an overwhelming thing for many people to understand, not just seniors, but with a little help and experience you will see just how fun and easy it is!

Thursday, January 31, 2013

Bye Bye Fixed Rate Reverse

Reverse mortgage changes are coming
Yesterday HUD announced when they will be getting rid of the traditional fixed rate reverse mortgage program.  If you are considering a reverse mortgage or know someone who is you have until the end of March 2013 to get started or you will be out of luck. Starting April 1, 2013 all fixed rate loans will be forced to the "saver" program.  The saver program has its benefits, but it has its drawbacks too.  The mandatory 2% government mortgage insurance is gone which will lower the fees, but the trade-off for lower fees is a much lower loan to value.  If you are close to qualifying for the program now chances are you will not qualify after April 1st!  If you do qualify after April, you will not qualify for near as much money.

This move by the FHA is to try to save money and in the short term it will work, but like always the government doesn't think long term, they just think until the next election.  Now in order to qualify many people will be forced to the traditional adjustable rate loan (which as of now is not going away).  Recently this program has not been used much because most seniors want a fixed rate, but if the need is there and it is the only option they will do the ARM.  In the short term when interest rates are low, this won't matter, but the Fed can't keep rates low forever, so when they start going up, the FHA is going to be on the hook for more underwater reverse mortgages than they bargained for.  As a result, all the short term savings will be wiped out by big time losses!

Enough of the rant...the decision has been made by the powers that be and we just have to deal with it.  So, if you or someone you know is considering a reverse mortgage NOW IS THE TIME!  It's best to get started early because March is going to be crazy with all the procrastinators and you don't want to chance not being able to qualify!  Check out our reverse mortgage calculator and see if you are a reverse mortgage candidate today!

To check out the letter from HUD about these changes click here.

Saturday, January 19, 2013

Here's Some Shocking Retirement Statistics

Scary Retirement StatisticsAre you planning to retire?  Ever?  Most of us have great plans to quit working and travel, or move closer to the kids, or just do something worthwhile when we retire.  The problem over the past few years though this goal of retirement seems to be getting farther away for most of us.  Times are tighter and many people who thought they should be retired by now are still working.  So take a look at these 35 retirement statistics and see if you get worried.  If you do and see no hope, there is a great option...hmm I wonder what that could be!


1. Right now, there are somewhere around 40 million senior citizens in the United States. By 2050 that number is projected to skyrocket to 89 million.
2. According to one recent poll, 25 percent of all Americans in the 46 to 64-year-old age bracket have no retirement savings at all.
3. 26 percent of all Americans in the 46 to 64-year-old age bracket have no personal savings whatsoever.
4. One survey that covered all American workers found that 46 percent of them have less than $10,000 saved for retirement.
5. According to a survey conducted by the Employee Benefit Research Institute, "60 percent of American workers said the total value of their savings and investments is less than $25,000".
6. A Pew Research survey found that half of all Baby Boomers say that their household financial situations have deteriorated over the past year.
7. 67 percent of all American workers believe that they "are a little or a lot behind schedule on saving for retirement".
8. Today, one out of every six elderly Americans lives below the federal poverty line.
9. More elderly Americans than ever are finding that they must continue working once they reach their retirement years. Between 1985 and 2010, the percentage of Americans in the 65 to 69-year-old age bracket that were still working increased from 18 percent to 32 percent.
10. Back in 1991, half of all American workers planned to retire before they reached the age of 65. Today, that number has declined to 23 percent.
11. According to one recent survey, 70 percent of all American workers expect to continue working once they are "retired".
12. According to a poll conducted by AARP, 40 percent of all Baby Boomers plan to work "until they drop".
13. A poll conducted by CESI Debt Solutions found that 56 percent of American retirees still had outstanding debts when they retired.
14. Elderly Americans tend to carry much higher balances on their credit cards than younger Americans do. The following is from a recent CNBC article...
New research from the AARP also shows that those ages 50 and over are carrying higher balances on their credit cards -- $8,278 in 2012 compared to $6,258 for the under-50 population.
15. A study by a law professor at the University of Michigan found that Americans that are 55 years of age or older now account for 20 percent of all bankruptcies in the United States. Back in 2001, they only accounted for 12 percent of all bankruptcies.
16. Between 1991 and 2007 the number of Americans between the ages of 65 and 74 that filed for bankruptcy rose by a staggering 178 percent.
17. What is causing most of these bankruptcies among the elderly? The number one cause is medical bills. According to a report published in The American Journal of Medicine, medical bills are a major factor in more than 60 percent of the personal bankruptcies in the United States. Of those bankruptcies that were caused by medical bills, approximately 75 percent of them involved individuals that actually did have health insurance.
18. In 1945, there were 42 workers for every retiree receiving Social Security benefits. Today, that number has fallen to 2.5 workers, and if you eliminate all government workers, that leaves only 1.6 private sector workers for every retiree receiving Social Security benefits.
19. Millions of elderly Americans these days are finding it very difficult to survive on just a Social Security check. The truth is that most Social Security checks simply are not that large. The following comes directly from the Social Security Administration website...
The average monthly Social Security benefit for a retired worker was about $1,230 at the beginning of 2012. This amount changes monthly based upon the total amount of all benefits paid and the total number of people receiving benefits.
Could you live on about 300 dollars a week?

20. Social Security benefits are not going to stretch as far in future years. The following is from an article on the AARP website...
Social Security benefits won't go as far, either. In 2002, benefits replaced 39 percent of the average retirees salary, and that will decline to 28 percent in 2030, when the youngest boomers reach full retirement age, according to the Center for Retirement Research at Boston College.
21. In the United States today, more than 61 million Americans receive some form of Social Security benefits. By 2035, that number is projected to soar to a whopping 91 million.
22. Overall, the Social Security system is facing a 134 trillion dollar shortfall over the next 75 years.
23. The number of Americans on Medicare is expected to grow from 50.7 million in 2012 to 73.2 million in 2025.
24. Medicare is facing unfunded liabilities of more than 38 trillion dollars over the next 75 years. That comes to approximately $328,404 for each and every household in the United States.
25. Today, only 10 percent of private companies in the U.S. provide guaranteed lifelong pensions for their employees.
26. Verizon's pension plan is underfunded by 3.4 billion dollars.
27. In California, the Orange County Employees Retirement System is estimated to have a 10 billion dollar unfunded pension liability.
28. The state of Illinois has accumulated unfunded pension liabilities of more than 77 billion dollars.
29. Pension consultant Girard Miller told California's Little Hoover Commission that state and local government bodies in the state of California have 325 billion dollars in combined unfunded pension liabilities.
30. According to Northwestern University Professor John Rauh, the latest estimate of the total amount of unfunded pension and health care obligations for retirees that state and local governments across the United States have accumulated is 4.4 trillion dollars.
31. In 2010, 28 percent of all American workers with a 401(k) had taken money out of it at some point.
32. Back in 2004, American workers were taking about 30 billion dollars in early withdrawals out of their 401(k) accounts every single year. Right now, American workers are pulling about 70 billion dollars in early withdrawals out of their 401(k) accounts every single year.
33. Today, 49 percent of all American workers are not covered by an employment-based pension plan at all.
34. According to a recent survey conducted by Americans for Secure Retirement, 88 percent of all Americans are worried about "maintaining a comfortable standard of living in retirement".
35. A study conducted by Boston College's Center for Retirement Research found that American workers are $6.6 trillion short of what they need to retire comfortably.

So are you scared yet?  We all should be.  We are all in a big mess and it is going to hurt really bad in order to clean it up.  So what can we do?  Well if you are 62 and older the reverse mortgage can be a great option to help supplement your retirement.  The reverse mortgage is not for everyone, first you have to qualify for it with enough equity in your home along with being 62 or older, and second there are some people who just don't need it.  If you have questions about it, don't wait!  The FHA is changing the program and will make it even harder to qualify for than it already is.  Take a look at our reverse mortgage calculator and see if you qualify.

Now let me give credit where credit is due.  Michael Snyder from the economic collapse blog posted these 35 statistics on his blog the other day. To view his article click here.