Feb 142017
 

Making the decision to do (or not to do) a Reverse Mortgage is a big decision.  Any major financial moves a homeowner makes should be done after careful consideration.  Your loan officer has a fiduciary responsibility to have your best interest at heart.  However, at the end of the day, a loan officer does make money by doing loans, so it’s a good idea to get educated as much as you can via your loan officer, but also to educate yourself by perusing other info provided by a neutral third party that does not benefit from YOU doing a reverse mortgage in California, or any other state for that matter.

HECM Reverse Mortgage Resources

HECM Reverse Mortgage Resources

That’s what we intend to offer here – resources for you to access that are not affiliated with this site or any particular lender.

Before we do that, here is something else to consider as you forge ahead and educate yourself about reverse mortgages.

Is your loan officer a reverse mortgage / HECM specialist?

Is your loan officer a reverse mortgage / HECM specialist OR do they simply do traditional loans and can potentially do reverse loans?  I actually work in a company that mainly focuses on traditional loans.  I manage a division within this company that focusses on Reverse Mortgages.  My staff only does reverse mortgages.  They truly are specialists.  Believe me, before I became a specialist (like when I was just doing traditional loans), you would not have wanted to do a reverse with me. I knew the basics, but not much more, but that was 15 years ago.  Today, I only do reverse loans and I know them well.

How can I tell if I’m working with someone that is well versed in the HECM product?

Frankly, you may not be able to.  Some will tell you that they are well versed in doing them and some will just pretend.  There are a couple of things you can do.  1. Check the website for the company your loan officer works for.  Does it at least have a dedicated page for reverse loans?  If not, the person may not be all that well versed in the reverse loan (naturally, exceptions apply).  2. Look at their resume on the NMLS Consumer Access.  All loan officers are required to get licensed through the National Mortgage Licensing System.  If you go to NMLS Consumer Access, you can see their resume (which includes their job title, time in the business, time with each company, and a list of states they are licensed in and / or were licensed in).  Here is the link; NMLS Consumer Access

The National Council on Aging (aka NCOA):

The National Council on aging is a non-profit organization that was formed in 1950 and is a well-respected national leader that has a website which provides resources geared towards improving the health and economic security of older adults.

Here is a link to the main page for the National Council on Aging.

The NCOA is also a neutral 3rd party.  They do not benefit by you doing a reverse mortgage, so it’s a great place to get non-biased info about reverse mortgages.  In fact, HUD (Reverse Mortgages are insured by HUD / FHA) requires lenders to send a pamphlet about reverse loans from the NCOA in every proposal a lender, loan officer, broker, or counselor sends you (it’s required that you have this packet from either the lender/broker or counselor before you can do your counseling appointment).

Here is a link to the NCOA Reverse Mortgage Info page.

If you’d like a copy of the free NCOA Booklet about reverse mortgages, please send me an email requesting it at shawnv@ReverseMortgageCalifornia.biz or call (714) 271-8524 (cell phone).

HUD / FHA:

This blog / webpage is not affiliated with HUD / FHA.  Reverse Mortgages are neither “endorsed” nor “approved” by the Federal Government. Only a lender and / or broker can originate an FHA loan. The FHA (Federal Housing Administration) simply provides certain insurance benefits for lenders and borrowers in connection with the lender’s HECM loans; the FHA does not make or originate loans.  You can find info about the FHA insured Home Equity Conversion Mortgage (Reverse Mortgage) on the HUD portal.

Here is a link for HUD’s Reverse Mortgage Info page.

American Association of Retired Persons (aka AARP):

Like NCOA, AARP is a non-profit organization that was founded in 1958 with the intent to enhance the quality of life for all as they age.  AARP is not a Reverse Mortgage lender, and again, they offer un-biased info about Reverse Mortgages.

Here is a link to their main page; AARP

HUD Reverse Mortgage Counseling:

One of the HUD requirements prior to ordering a case number with the intent to move forward with a reverse mortgage is that an interested homeowner get reverse mortgage counseling from a neutral 3rd party that is not affiliated with any lender or loan broker. 

It’s simply an effort to help ensure that you know what kind of transaction you’re entering into.  

Note: Your loan officer is not permitted to provide you with a specific recommendation.  They are simply supposed to provide a list of eligible counselors.

The opposite is also true; your counselor may not recommend any specific lenders.  Both of the practices are not allowed by HUD.

HECM counselors from the list below can provide face-to-face and telephone counseling nationally.

Agency Name and Website Telephone
National Foundation for Credit Counseling (866) 698-6322
Money Management International (877) 908-2227
ClearPoint Financial Solutions (800) 251-2227
Springboard (800) 947-3752
HomeFree (301) 891-8423
Greenpath (888) 860-4167
Neighborhood Reinvestment Corporation (888) 990-4326

For your free Reverse Mortgage California brochure, please email slvReverseMortgage@gmail.com   OR shawnv@ReverseMortgageCalifornia.biz

Shawn Lawrence Vaillancourt

NMLS License # 387151 in CA, CO, VA, MD, WA, OR

I also have a staff of reverse mortgage specialists in virtually every other state in America.

For more in depth info on all Reverse Mortgage subjects, check out

www.reversemortgagecalifornia.biz 

Reverse Mortgage Info

Jan 252014
 

Are you considering using a Reverse Mortgage for your property in California?  Let us help you navigate through the process.  We’ll cover it all, the good, the bad and the ugly.

Let’s face it, California is not a cheap and easy market to live in.  Many pockets of California are among a few of the most expensive markets nationally, so a Reverse Mortgage can be a phenomenal tool to help aging homeowners navigate the waters of their “golden years” in California – The Golden State.

California Reverse Mortgages – The Basics of the FHA insured Reverse Mortgage

reverse mortgage california

Reverse Mortgage California

A very simplistic way to explain a Reverse Mortgage is as follows; for all intents and purposes it works JUST like a traditional mortgage, but there are just a few tiny, key differences.

First, there is an age requirement.  You have to be aged 62 or older to qualify.  If you’re married, we have to base the available loan amount on the date of birth of the youngest spouse.

Second, there is an equity requirement.  As of August 2014, you can get anywhere from about 52.4% – 75% of your homes appraised value with a Reverse Mortgage.  It all just depends on your age.

For your free Reverse Mortgage California brochure, please email shawnv@ReverseMortgageCalifornia.biz

The third and BEST difference (for 99.99% of older homeowners):

It is that there are NO monthly payments due for as long as you live or for as long as you live in your home(The Reverse Mortgage is intended to be used only on your primary residence (although there have been times over the years where it could be done on your 2nd home)).

For many, this type of loan can lift a heavy burden by eliminating any mortgage payments they may currently have. For others that might own there home free and clear, it can infuse a tremendous amount of money into their bank account to be used however they chose.

What would you like a reverse mortgage do do for you? 

This is the most important question you can ask yourself if you or a loved one is considering a reverse mortgage in the great state of California.

Reverse Mortgage Frequently Asked Questions:

What about my property taxes and insurance?

It’s true, there are no monthly mortgage payments due to the bank that services your reverse mortgage loan, BUT keep in mind you will need to pay your property taxes and insurance.  Remember, this is just a loan and you still own your property in the same fashion as if you had a traditional mortgage.  The bank does not go on title at all and you are able to leave your home to whomever you like in your will.

How much money can I get if I do A Home Equity Conversion Mortgage?

Remember, the amount you get is always based on the youngest homeowner.  A 62 year old can get up to 52.4% of their home’s appraised value.  On the other side of the spectrum, a 90

California Reverse Mortgages

California Reverse Mortgages

year old can access up to 75% of their homes value (and this is the maximum loan to value, even if you are older).  The older you are, the more you get and the amount you get moves on a sliding scale from

52.4% to 75% for those aged 62 – 90 years old.  Here are a couple of examples of how much you can borrow based on your age:

62 Years old – 52.4% of appraised value.

68 Years old – 56.2% of appraised value.

74 Years old – 60.6% of appraised value.

80 Years old – 65.7% of appraised value.

86 Years old – 70.9% of appraised value.

Is there ever a time where I will have to pay the loan off or will have to resume making payments?

To be clear, when you do a reverse loan, you are responsible for maintaining insurance and paying your property taxes.  In terms of making a principal and interest payment, you will never have to do that for as long as you live or for as long as you live in your home.  That does not change, even if you did the loan at age 62 and lived to the age of 110.

Am I able to make a payment?

Yes, you can definitely make a payment.  In fact, you can pay any amount you want.  There just no required payment.  If you want make an interest only payment, you can.  If you want to pay $100 per month, you can.  This would just simply keep the loan balance from growing as rapidly.  And of course, it would help you maintain a larger equity reserve for your children (or whomever your heirs might be).  The key with a HECM is that there is total flexibility.  YOU are in charge of your financial destiny.

Will I be able to qualify to get this type of financing?

Reverse Mortgage Brokers California

Reverse Mortgage Brokers California

Here are the basic qualifications:

  • The home has to be your primary residence and cannot currently be done on a 2nd home or rental property.
  • As far as property types go, one can get a reverse mortgage on a double wide manufactured home (has to conform to HUD guidelines), a modular home, a condominium that has an FHA approved homeowner association, a townhome, a single family home, and a 2-4 unit property (you have to reside in one of the units).  HUD does allow it do be done on single-wide manufactured homes, BUT very few lenders actually offer this.
  • There’s the age and equity requirement which we’ve already discussed.
  • Credit guidelines are pretty relaxed.  Credit scores do not matter, but your housing payment history for the last 1-2 years does matter along with your 1 year pay history for your revolving trade lines like credit cards.
  • There are no debt to income requirement, but there are residual income requirement.  Basically, after you add up all the monthly payment that show up on your credit report and monthy property tax and insurance liabilities and utilities, you need to have some residual income left over.  The short version is that if you have a 1 person household, you need to have a little over $500 in residual income and the exact amount varies depending on what part of the country you live in.  If you have a 2 person household, you need a little over $900 in residual income.  Again, the exact amount depends on where exactly you live.
  • Regarding your credit, if it’s been good in the last 2 years and you’ve paid your taxes on time (property taxes), you should have no worries and it will just come down to the age/equity requirement.
  • If your credit is not sterling, you may still be able to do a reverse mortgage, but you may have to set some of the loan proceeds aside to pay your future taxes and insurance.

What steps are involved in getting a Reverse Mortgage in California (or any other state for the matter)??  (The list looks long, but it’s pretty easy)

  1. Do your own investigation and see if you meet the basic age and equity requirements.
  2. Have your loan officer send you a proposal that details all the particulars (interest rates, estimated appraised value, loan amount, loan costs, counseling documents, NCOA booklet, etc.).
  3. Write down any questions you have once you review the package.
  4. If it works for you, set up a counseling appointment.
  5. Ask the counselor to send your loan officer a faxed copy of the counseling certificate (assuming you want to move forward).
  6. Connect with your loan officer to take an application for you to sign and return.
  7. Lenders can order the appraisal when they have a signed application and a signed counseling certificate.
  8. Have a discussion with your loan officer in regard to certain things the appraiser will be looking for when he comes to your home (i.e., do you have smoke detectors, CO detectors, etc.?).
  9. Provide your loan officer with copies of the items he needs to process the loan (i.e. income documentation, mortgage statement, etc.).
  10. Once the appraisal comes back to the lender/broker, hopefully your loan is all processed and ready to go to the underwriter.
  11. The underwriter will have a few conditions which your loan officer and processor will work on (they may need additional things from you).
  12. Get final approval and then sign your final reverse mortgage documents.
  13. Wait out the 3 business day cooling off period.
  14. Your loan funds and you enjoy not having a mortgage payment.

For your free Reverse Mortgage California brochure, please email shawnv@ReverseMortgageCalifornia.biz

Shawn Lawrence Vaillancourt

NMLS License # 387151.  Licensed in CO, CA, WA, OR, MD, VA

(714) 271-8524

For more in depth info on all Reverse Mortgage subjects, check out

www.reversemortgagecalifornia.biz 

Reverse Mortgage Loan Advisors

Want Reverse Mortgage Info in other states?:

Reverse Mortgage in Maine

Reverse Mortgage Colorado

Wisconsin Reverse Mortgage