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How Economy Affects Mortgage Interest Rates
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How A Reverse Mortgage Works
Home Owners: Avoid Complications In Credit Repair
Guide To Mortgages In The UK
Home Equity Loan – A Reverse Mortgage Could Provide A Comfortable Retirement!
Reverse Mortgage Fears
Reverse Mortgage
Reverse Mortgage is something, which can enable an individual to
withdraw the money from the bank .....
Discover what information you need regarding the understanding and use of reverse mortgage concerns.Reverse Mortgage is something, which can enable an individual to
withdraw the money from the bank .....
Estimates indicate that there is a target population of some 8.8
million senior households that both qualify for and are good
potential candidates for HUD's home equity conversion mortgage
(HECM)program. (Under an HECM loan, a lender advances money to a
How Do I Prepare For Retirement?
elderly homeowner, in the form of a series of fixed monthlyWhen the day finally arrives, will you be ready? What do you need to do? How do you need to prepare? Well, if you .....
payments, a line of credit on which the borrower may draw, or a
combination. The senior homeowner is not required to make any
payments on the loan so long as he or she remains in the house.
The lender collects the loan balance--which includes the accrued
interest and other charges as well as the amounts paid out--when
the house is sold or the owner dies.)
Yet in the most recent federal fiscal year, just 43,131 HECM
loans were originated; over the sixteen year history of the
program, a total of 162,268 HECMs have originated, representing
only a tiny share of the potential market.
There are some obvious and tangible factors that help explain
this low market penetration, most notably the high origination
fees and closing costs relative to amounts that can be borrowed
through the program. Less obvious are the intangible
psychological fears that may prevent senior homeowners from
stepping into a reverse mortgage. Being aware of these factors
can help potential borrowers more clearly assess their own
situation and make a more calculated decision about whether or
not a reverse mortgage is right for them:
Fear of Giving-up a Hard-Earned Goal - Most elderly homeowners
Market Influence Of Interests Rates
The result of rising interest rates is that there is an increase
in mortgage payments .....
have spent their working lives focused on the goal of "payingThe result of rising interest rates is that there is an increase
in mortgage payments .....
off the mortgage." Taking out a reverse mortgage is, in essence,
a decision to do a complete turnabout and initiate the process
IS A HOUSING BUBBLE BREWING?
In the 1990s, dot-com mania swept the nation, and swelling investment portfolios were the toast of the .....
In the 1990s, dot-com mania swept the nation, and swelling investment portfolios were the toast of the .....
of growing a new mortgage. For some seniors, this just doesn't
make sense, no matter how rational the decision to trade-in home
equity for better living standards in later life may appear to a
This is more information about reverse mortgage concerns to help you best understand and how it can help you.
Reverse Mortgages Funding Retirement
Reverse Mortgages - Funding Retirement
detached observer.
Fear of Being Suckered - HECMs are administered, heavily
regulated and insured by federal government agencies (in
particular HUD). From the standpoint of protecting innocent
borrowers from ruthless lenders, HECMs are about as "safe" a
mortgage product as can be imagined. Yet there are true horror
stories from the pre-HUD reverse mortgage era about seniors
being forced to sell their homes or losing them to foreclosure.
Unfortunately, these stories have now become urban legends and
still taint the phrase "reverse mortgage".
A related issue is the ongoing problem of elderly homeowners
being contacted by "home repair" companies, annuity
salespersons, and other pitch-men promoting the reverse mortgage
as the ideal way to pay for their valuable product or service.
The tacky nature of this type of solicitation further increase
doubts and fears about whether reverse mortgages are truly
legitimate.
Fear of Financial Complexity - There is no question that
reverse mortgages are complex financial tools. Moreover, by
their very nature they run counter to many of the golden
financial management rules that senior homeowners have strived
to abide by over their adult lives - i.e. "reduce debt", "avoid
high transaction fees", "grow your home equity", etc. Largely
because of the complexity, HUD requires all HECM applicants to
participate in counseling sessions to ensure they have full
understanding of the reverse mortgage process and the other
alternatives that may be available. Yet, while necessary and
well-intended, the counseling requirement itself may scare-off
some potential applicants who feel that they just won't be
capable of digesting all the new information presented.
Fear of Not Leaving an Inheritance - For many seniors, the
desire to leave an inheritance to children or grandchildren is
quite strong - even to the point of accepting a more modest than
necessary lifestyle to ensure that an estate survives them.
Seniors who have this goal and whose largest asset is their
directly counter to their strong bequest motive.
Fear of Sacrificing Future Flexibility - To be a sensible
financial decision, a reverse mortgage should equate to a
conscious decision by the homeowner to stay put for the long
term - minimally 5-7 years and, ideally, for the rest of the
homeowners' lives. Obviously, this commitment is especially
difficult for the elderly homeowner. Death, long-term illness or
incapacity and similar issues weigh heavily on the minds of many
seniors and make long-term housing commitments especially
stressful.
To a large extent, further growth in the reverse mortgage area
will depend on the success of efforts to educate the target
population. Some observers feel that the next generation of
retirees -i.e. Baby Boomers - will enter their retirement years
with a far greater understanding of financial matters and with
less aversion to indebtedness. This may prove true but the
reverse mortgage concept is so fundamentally different from what
people are used to that overcomming the fears of potential
borrowers will remain a challenge.
About the author:
Tim Paul is a financial management executive. His websites focus
on personal finance issues including
href="http://www.sagetips.com" target=_blank">HELOC Loans
and
href="http://www.reverse-mortgage-information.org"target=_blank">
reverse mortgages.
Check out some the other pages on our wesite to find out more about reverse mortgage concerns.
detached observer.
Fear of Being Suckered - HECMs are administered, heavily
regulated and insured by federal government agencies (in
particular HUD). From the standpoint of protecting innocent
borrowers from ruthless lenders, HECMs are about as "safe" a
mortgage product as can be imagined. Yet there are true horror
stories from the pre-HUD reverse mortgage era about seniors
being forced to sell their homes or losing them to foreclosure.
Unfortunately, these stories have now become urban legends and
still taint the phrase "reverse mortgage".
A related issue is the ongoing problem of elderly homeowners
being contacted by "home repair" companies, annuity
salespersons, and other pitch-men promoting the reverse mortgage
as the ideal way to pay for their valuable product or service.
The tacky nature of this type of solicitation further increase
doubts and fears about whether reverse mortgages are truly
legitimate.
Fear of Financial Complexity - There is no question that
reverse mortgages are complex financial tools. Moreover, by
their very nature they run counter to many of the golden
financial management rules that senior homeowners have strived
to abide by over their adult lives - i.e. "reduce debt", "avoid
high transaction fees", "grow your home equity", etc. Largely
because of the complexity, HUD requires all HECM applicants to
participate in counseling sessions to ensure they have full
understanding of the reverse mortgage process and the other
alternatives that may be available. Yet, while necessary and
well-intended, the counseling requirement itself may scare-off
some potential applicants who feel that they just won't be
capable of digesting all the new information presented.
Fear of Not Leaving an Inheritance - For many seniors, the
desire to leave an inheritance to children or grandchildren is
quite strong - even to the point of accepting a more modest than
necessary lifestyle to ensure that an estate survives them.
Seniors who have this goal and whose largest asset is their
Best Mortgage Deal UK - Put Your Best Foot Forward!
As a borrower for mortgage in UK it is your right to find the best finance deal .....
homestead, clearly will perceive that a reverse mortgage runsAs a borrower for mortgage in UK it is your right to find the best finance deal .....
directly counter to their strong bequest motive.
Fear of Sacrificing Future Flexibility - To be a sensible
financial decision, a reverse mortgage should equate to a
conscious decision by the homeowner to stay put for the long
term - minimally 5-7 years and, ideally, for the rest of the
homeowners' lives. Obviously, this commitment is especially
difficult for the elderly homeowner. Death, long-term illness or
incapacity and similar issues weigh heavily on the minds of many
seniors and make long-term housing commitments especially
stressful.
To a large extent, further growth in the reverse mortgage area
will depend on the success of efforts to educate the target
population. Some observers feel that the next generation of
retirees -i.e. Baby Boomers - will enter their retirement years
with a far greater understanding of financial matters and with
less aversion to indebtedness. This may prove true but the
reverse mortgage concept is so fundamentally different from what
people are used to that overcomming the fears of potential
borrowers will remain a challenge.
About the author:
Tim Paul is a financial management executive. His websites focus
on personal finance issues including
href="http://www.sagetips.com" target=_blank">HELOC Loans
and
href="http://www.reverse-mortgage-information.org"target=_blank">
reverse mortgages.
Check out some the other pages on our wesite to find out more about reverse mortgage concerns.
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