Reversemortgage.net

Reverse Mortgage

According to Reverse Mortgage Insight, the reverse mortgage lending seems to be caught in a downward spiral.On a year-over-year basis, volume is now declining at a precipitous pace. If there is any silver lining, however, it is is that the number of reverse mortgage lenders also seems to be dwindling, such that those lenders that have survived have actually experienced an increase in business.

Actived: Wednesday Dec 2, 2020

URL: http://www.reversemortgage.net/

What is the Purpose of HECM Reverse Mortgage Insurance?

Details: Most borrowers realize that the greatest cost component of their HECM reverse mortgage are the FHA insurance premiums, paid both up-front and annually.Fewer understand the function of such insurance, why they are required to purchase it, and why the cost should be so significant.

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Reverse Mortgage Insurance Explained

Details: Mortgage Insurance Premium is 1.25% per year and is added to the Interest rate of the loan. Which is it, .5% or 1.25% ? thank you, laurie Says: June 1st, 2015 at 9:32 pm. my mother recently got a reverse mortgage. home value $425,000. the mip insures $625,000 and costs over $400.00 per month. she only got $160,000. when escrow closed and will

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3 Different Types of Reverse Mortgages: HECM, Single

Details: While you would assume that the lack of insurance would make such mortgages more risky, you would be wrong. That’s because reverse mortgage insurance serves to protect the lender against default (even though the premiums are paid by the borrower), so the lack of insurance in this case is a risk born exlclusively by the lender.

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Paying Down Reverse Mortgages

Details: Because there is a serious risk that one day the loan will become negative equity (the loan balance will exceed the value of the home), the FHA charges borrowers a 1.25% annual insurance premium. By repaying the loan, borrowers are essentially alleviating lenders/FHA of this risk while still being charged for it.

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"HECM Lite:" Two Birds, One Stone. Lower Borrowing Amounts

Details: As FHA insurance premiums rise, criticism will once again mount that the HECM is uneconomical for many, if not most borrowers. As a result of this new product, however, those who wish to borrow comparatively modest amounts and are consequently unlikely to default, will be able to do so at a comparatively reasonable cost.

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Fannie Mae Reverse Mortgage Home Loans

Details: Why does the conventional HECM reverse mortgage charge the Mortgage Insurance Premium and Fannie Mae Housekeeper doesn’t? Is Fannie Mae default free? I am trying to decide which is a better program for my parents. Julia Lucio Says: April 14th, 2010 at 10:26 am.

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HECM Saver Changes the Math for Reverse Mortgages. HECM

Details: Even when you factor in the annual insurance premium of 1.25%, the total interest rate is still apparently below current HELOC rates. Moreover, the reverse mortgage variable rate and HELOC rate are typically derived from similar rate indexes, which means that this spread should remain constant, regardless of any fluctuations in interest rates.

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Credit Checks for Reverse Mortgages

Details: Instead, lenders merely need confirmation that borrowers have the means to pay property taxes, hazard insurance premiums, and maintain their properties, thereby mitigating any possibility of default. With HECM reverse mortgages, this is not of primary concern to lenders. To be sure, default/foreclosure is always unfortunate, and it is an

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What Happens When Reverse Mortgage Borrower Dies?

Details: During this time, taxes/insurance premiums must continue to be paid, and the loan will continue to accrue interest. If after 12 months no progress has been made or if the heirs violate the terms of the contract in some other way, you can expect the lender to initiate foreclosure proceedings.

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Most Reverse Mortgages Terminated within 6 Years

Details: Actually, lender insurance claims have been surging in recent years, but this is probably less due to over-borrowing than to declining home values. In this sense, the average duration of loans doesn’t bear too significantly in the solvency of the FHA and its need for a subsidy. Jay Says: July 1st, 2012 at 10:26 pm

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Bank of America Reverse Mortgages

Details: The flood insurance premuims are governed by FEMA. The premium is determenined by the position of the buiding on the 100 year flood plane. If her home is closer to the flood area by elevation than the neighbor across the street or even the home next door her premium will be higher than theirs.

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Is Your Reverse Mortgage Underwater? What You Should Know

Details: Instead, the FHA will reimburse the lender using funds from the insurance pool. As a result, it is IMPOSSIBLE that you will ever end up owing your lender more than what you borrowed, regardless of what happens to the value of your home in the interim. (Note that this is not necessarily the case with a conventional mortgage).

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reverse mortgages (8)

Details: Remember that the insurance protects the lender, and the only way for a lender to protect itself absent of insurance would be to charge a very high interest rate and/or to hold the borrower liable if the price of their home declines. The latter is now illegal, and the former would be self-defeating. So, there you have it: your Tax Dollars at work.

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HUD Issues Reverse Mortgage Default Guidance. Delinquent

Details: AGI includes health insurance premiums and prescription costs. As a result, there are no property tax defaults for hecm (reverse mortgage) borrowers in the State of Idaho. This Tax Exemption Program is legislated and administered by the Idaho State Tax Commission and implemented by the 44 County Assessors which comprise the State of Idaho.

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What Kinds of Reverse Mortgage Plans Are There?

Details: Home Equity Conversion Mortgages have a significant upfront cost (including a 2% origination fee and a 2% insurance premium), so if you only intend to stay in your home for a short period of time they can be quite expensive. If you live in your house for an extended period of time the cost is divided amongst many years, and is thus more reasonable.

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Reverse Mortgage Amortization Schedule

Details: Second, this insurance protects you from owing more on your reverse mortgage than your home is worth (a real possibility if you stay in your home long enough), which means that the loan balance on an FHA-insured loan is only relevant insofar as you (or your heirs) ultimately intend to keep your house and pay off the reverse mortgage in cash.

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California Becomes First State to Clamp Down on Reverse

Details: Namely, it seeks to crack down on “cross-selling” of annuities and insurance products with reverse mortgages, and increase counseling requirements for new borrowers. The former aim is pretty straightforward. One of the biggest criticisms of reverse mortgages is that they are often paired with annuities by lenders looking to make additional

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No Closing Cost Reverse Mortgage

Details: Especially since the HECM Saver (which doesn’t carry an upfront insurance premium) was introduced, lenders have little choice but to reduce closing costs if they want to offer a less expensive product. In short, before committing to a specific lender, make sure you do some research.

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Is Reverse Mortgage Interest Tax-Deductible? When do you

Details: If one pays off a reverse mortgage due to a relocation, can any interest paid for the year of sale and/or years prior be considered tax deduction. Also, can any of the service fees, insurance fees, etc be deducted. Thanks in advance. Shelley Says: January 14th, 2017 at 9:53 pm

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Reverse Mortgage Satisfaction Still Unknown

Details: Borrowers sign a few forms, have their homes appraised, and then receive significant sums of money. There are no monthly payments, and the lender will only come calling if the terms of the loan agreement are breached (i.e. if the borrower neglects to pay taxes and hazard insurance premiums, or fails to maintain the property).

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(5) - Reverse Mortgage

Details: The upfront mortgage insurance premium will be 2%, and the annual premium is slated to rise from .5% to 1.25%. Principal limits will probably remain at current levels (having been slashed already), and interest rates might be higher to compensate for the added risk.

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Reverse Mortgage Calculator

Details: First you must decide between an HECM Standard and HECM Saver. The main difference between these two loan types is that an HECM Standard offers a higher loan amount, and consequently, an upfront insurance premium. (For more on this distinction, you can read an earlier post on the subject). You can see how this is reflected in the calculations.

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How Do Housing Prices Affect Reverse Mortgages?

Details: Really, the only way that you can “win” is if your house depreciates over time to such an extent that your mortgage is underwater, and the FHA – thanks to the mandatory insurance policy – picks up the tab for difference.

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About Reverse Mortgage.net

Details: Is there insurance or is the “estate” responsible for the balance due? Natalie Says: January 13th, 2013 at 11:57 am. My inlaws are in upstate New York (north of Albany). They are looking for a bank that does reverse mortgages. Any suggestions. gee Hen Says: January 29th, 2013 at 2:02 pm. do you have an office in Washington state? WHERE?

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How will the FHA’s Financial Troubles Affect Reverse

Details: Earlier this week, it was announced that the FHA’s insurance reserves have fallen below the benchmark 2% level of insurance commitments. In fact, it is now only .53%, and some analysts are suggesting that it could soon fall below zero, necessitating a government bailout.

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Odds and Ends: Maintenance Violations and Tax Deductions

Details: Unfortunately, this is a very serious contingency, especially when you consider that the product is designed for borrowers with precarious financial situations. If your home declines in value and/or the balance of the loan cannot be repaid, it is HUD (via its insurance arm) that is on the hook for the difference.

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Reverse Mortgage Fees Fall, but Still High

Details: The former four will eliminate the origination fee and service fee set aside (SFSA), while Bank of America will contribute 50% of the reverse mortgage insurance premium. (In practice, these cuts are almost equivalent). All of the lenders have also announced reductions in in the interest rates that they will charge borrowers.

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FHA Gives Green Light on Reverse Mortgage Foreclosure

Details: The initiative is designed to target borrowers that aren’t paying property taxes and/or hazard insurance premiums, as well as those that aren’t properly maintaining their properties. Given the terms of FHA HECM reverse mortgages, it is only such borrowers who will be affected.

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2010 May - Reverse Mortgage

Details: Remember that the insurance protects the lender, and the only way for a lender to protect itself absent of insurance would be to charge a very high interest rate and/or to hold the borrower liable if the price of their home declines. The latter is now illegal, and the former would be self-defeating. So, there you have it: your Tax Dollars at work.

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Demographics to Drive Reverse Mortgage Growth

Details: Many lenders have also cut their origination fees and/or offered to subsidize FHA insurance premiums for borrowers, which is appropriate since lenders bear zero risk from the reverse mortgages they originate. On the other hand, there is a growing awareness that reverse mortgages are not appropriate for all borrowers, namely those with short

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The Reverse Mortgage Debt Obligations of Borrowers' Heirs.

Details: It is because of this FHA insurance, that neither the borrower nor his heirs bear an risk from property depreciation (unlike with a conventional mortgage) when obtaining a reverse mortgage. [If the reverse mortgage was an insured private loan, the above doesn’t apply].

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2010 November - Reverse Mortgage

Details: On the one hand, the absence of FHA insurance premiums eliminates one of the most significant costs for borrowers. On the other hand, this also removes the main safety feature of reverse mortgages, and besides, lenders will always compensate for the lack of insurance by charging a higher interest rate. They will also require a solid credit

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FHA Introduces FHA Saver! FHA Saver and FHA Standard will

Details: The HECM Standard will change as follows: the initial insurance premium will be raised from 1.25% to 2%, and the annual insurance premium will be hiked from .5% to 1.25%, in line with the HECM Saver. However, principal limits will remain at the elevated levels, implemented recently by the FHA in response to complaints.

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Reverse Mortgage No-Nos: How to Determine Whether a

Details: Short-term Time Horizon: Due to high upfront costs (origination fees, insurance premium, etc.), a reverse mortgage is simply not economical over a short time horizon. In order for it to be worthwhile, you should plan on staying in your property for a minimum of 7 years.

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Hawaii Reverse Mortgage Lenders

Details: Lenders may be retail banks, mortgage brokers, even insurance companies often provide mortgage and reverse mortgage products. FHA Loan Limits and HUD Reverse Mortgages The federally insured Home Equity Conversion Mortgage (HECM) is the hands-down most popular type of reverse mortgage across the board.

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Illinois Reverse Mortgage Lenders

Details: These unique financial tools offer a wide range of benefits when used correctly. Seniors may remain living in their homes permanently, retain the title to the home and make no payments against the mortgage. They are required to keep up property tax payments, insurance and general up-keep.

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2011 January

Details: With the HECM Saver, the expensive upfront mortgage insurance premium was effectively eliminated (though the annual insurance premium was left in place). To compensate for the increased risk and to minimize the chance of default, the FHA also reduced principal limits for the new product.

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Virginia Reverse Mortgage Lenders

Details: A wide variety of financial companies may offer reverse mortgages: retail banks, credit unions, mortgage brokers, investment and insurance companies and ultra-specialized reverse mortgage brokers. Here are a few of the types of companies you’ll find in Virginia.

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2010 April

Details: It is the responsibility of the lender to pay homeowners insurance and property taxes. In fact, the borrower’s only financial responsibilities are to continue paying homeowners insurance and property taxes, as well as to maintain the property in accordance with the law. Failure to do so could trigger a breach in the terms of the loan, and

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Reverse Mortgage Marketing Myths

Details: Lastly, in the worst case scenario, where the debt might potentially outrun the market value of the home, the mortgage insurance guarantees the non-recourse feature of the reverse mortgage – it protects the borrower and heirs against any personal liability for the repayment of the loan. Steve Says: November 9th, 2009 at 8:01 pm. Adam,

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Reverse Mortgage Prepayment is Declining, due to low

Details: Of course, many of those mortgages are now underwater, but this should concern neither borrowers nor lenders, thanks to the mandatory FHA insurance. After the collapse of the housing bubble, the FHA has understandably made it less desirable for reverse mortgage borrowers to refinance, by maintaining an interest rate floor and by lowering loan

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(2) - Reverse Mortgage

Details: Next, the mortgage insurance premium (mip) must be paid to FHA (assuming that the loan is a Home Equity Conversion Mortgage (HECM), as opposed to a proprietary reverse mortgage; this protects the lender (and indirectly, the borrower) from the possibility that the property could one day be worth less than the mortgage balance.

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Top 10 Reverse Mortgage Misconceptions

Details: It is the responsibility of the lender to pay homeowners insurance and property taxes. In fact, the borrower’s only financial responsibilities are to continue paying homeowners insurance and property taxes, as well as to maintain the property in accordance with the law.

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Reverse Mortgage Acceleration Clause

Details: The specific conditions that would trigger repayment are typically as follows: death of the last remaining borrower, vacating of the residence by the last remaining borrower, failure to maintain the property, and/or failure to pay homeowners insurance premiums and property taxes.

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Watch out for Reverse Mortgage Sales Pitches. Learn How to

Details: Meanwhile, loan limits and insurance premiums are constantly being adjusted by the FHA in accordance with actuarial assumptions about housing prices and life expectancy. Finally, don’t be fooled by personalized ads. Obtaining a reverse mortgage is extremely easy; as long as you are of a certain age and your home equity is above a certain

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2010 June - Reverse Mortgage

Details: First of all, let’s examine why that’s the case. In a nutshell, the origination fees, closing costs, service fee set-aside, and upfront insurance premium can consume 10% of the loan, before any funds have even been distributed to the borrower.If you allocate all of those fees over a long enough time period, they become infinitesimal on an annual basis.

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Washington Reverse Mortgage Lenders

Details: Retail banks, mortgage brokers, credit unions, insurance companies and specialized reverse mortgage lenders are examples of the types of companies often marketing reverse mortgages. Here is a sample of the types of companies you’ll find in Washington. Cedar River Mortgage is a regional company that serves Washington, Idaho and Oregon. The

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West Virginia Reverse Mortgage Lenders

Details: Reverse mortgage providers in West Virginia come in a variety of shapes and sizes and include retail banks, federal credit unions, mortgage companies and insurance companies. Some are located locally and others are known nationwide. Before you sign anything make sure your first step is finding a knowledgeable and trustworthy reverse mortgage

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2010 October - Reverse Mortgage

Details: The HECM Standard will change as follows: the initial insurance premium will be raised from 1.25% to 2%, and the annual insurance premium will be hiked from .5% to 1.25%, in line with the HECM Saver. However, principal limits will remain at the elevated levels, implemented recently by the FHA in response to complaints.

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Refinancing a Reverse Mortgage: Is it Worth It? What are

Details: With a refinancing, you don’t need to pay another up-front FHA insurance premium. You will only be assessed the premium on the increase in the balance of the loan. Another FHA rule is that you won’t be required to undergo a fresh counseling session if you the new funds you receive exceed five times the value of any new origination fees.

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