Feb 072017
 

Like most financial tools, a California Reverse Mortgage is not for everyone.  At the end of the day, one may consider a reverse mortgage for several reasons.  Typically, it’s to get more money or access more money (or to reduce their monthly liabilities by eliminating their mortgage payment).

That being said, here are some alternatives to doing a Reverse Mortgage (I called them the A, B, C’s):

Assets – Naturally, you can keep doing what you’re doing now and continue to live on the assets you have now (or shall I say, “live on the assets you DON’T have now”). In other words, do nothing.  Are you living the life you’ve always wanted? If you are, perhaps a Home Equity Conversion Mortgage (a.k.a.HECM) is not for you.

Borrow – you can borrow the traditional way by qualifying with credit, income, and assets.  Things to consider are; 1. Do you want a mortgage payment?  2. If you don’t have enough money coming in now, does borrowing the traditional way really help?  Or is it just delaying the inevitable? 3. If you borrow the traditional way, does it potentially eliminate the reverse mortgage as an option?  (for example, if you borrow 85% of your appraised value, there’s a good chance you won’t qualify for a reverse mortgage later because will have already borrowed more than you’d get with a reverse mortgage?…..or, would a Reverse Mortgage with NO monthly payment simply work better?

Children – If the family is willing, you can always borrow from them or get them to help out financially.  Many have that option and Many do not.  What about you?

Downsize – you can always sell your home and downsize (or go live with family).  Does moving out of your home seem like the best option for you?  Where would you go?  How long have you lived where you’re at now?  Have you really explored what the move is all about (i.e., the cost, the time involved with moving years of things, will have room for all your things or will you have to get rid of some or get a storage space?  Maybe this is the best option for you.  Only you can answer that question.

Enter the work force again.  Going back to work can help fill a monetary gap.  What kind of work would you do?  Would you try to reenter your former career?  Would you start over?  Depending on what kind of work you do, how long can you keep it up?  Maybe this is right for you.  Many retirees get bored because there so used to working and staying busy.

Equity release or equity sharing is another option.  Here is the short version of what this is; Although each company structures these transactions in different ways, the basic premise of the agreement is the same. The homeowner agrees to give up part of a their home’s future appreciation in exchange for cash.  The homeowner would typically give up 10% to 15% of their home’s current value.  This is also known as a REX Agreement.

…………………or, the remaining alternative of a Reverse Mortgage may be right for you.  A reverse mortgage will allow you to:

Find Peace of Mind.  The Reverse Mortgage:

  • Does not require any monthly mortgage payments
  • Allows you to stay in your home for as long as you live
  • Is easy to qualify for
  • Can help eliminate for alternative borrowing such as a loan with a mandatory payment or borrowing from family or seeking their assistance
  • Can eliminate the need to consider going back to work or continuing to work.

 

No matter how you slice it, not every option is right for every person.  If you think a reverse mortgage is right for you OR if you’d like to find out more please email slvReverseMortgage@gmail.com   OR shawnv@ReverseMortgageCalifornia.biz

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

www.reversemortgagecalifornia.biz 

www.reversemortgageloanadvisors.com

Jan 242017
 

Are you wondering about your reverse mortgage eligibility?

A reverse mortgage loan can be a great way to subsidize your income as you approach or enter your retirement years.  Before one starts to seriously explore and / or shop for a reverse mortgage, it’s important to ensure that you meet the eligibility requirements in the most basic sense.  That way you’re not wasting your time looking into a product that you don’t qualify to get.

Reverse Mortgage Eligibility

Reverse Mortgage Eligibility

Here are the basics when it comes to who is eligible to get a reverse mortgage.

First and foremost, you have to be aged 62 or older (United States).

Second, there are specific requirements for the collateral (your home).  For example your home must be one of the following to get a reverse mortgage:

  • SFR / Single family residential home.
  • Town home.
  • Condominium with an FHA / HUD approved homeowner association.
  • Double Wide manufactured home (most lenders do this, but not all) built after June 1976.
  • Single Wide manufactured home (very few lenders to this, but there are some out there so if one lender tells you know, move on to the next one) built after June 1976.
  • Modular homes
  • Two to four unit properties.

Thirdly, the home you wish to encumber by a reverse mortgage must be your primary residence.

A fourth eligibility requirement is that there is an equity requirement.  Depending on your age, a reverse mortgage lender can lend anywhere from 52.4% of the appraised value of your home to 75% of the appraised value (it moves on a sliding scale with a 62 year old getting 52.4% and a 90 year old getting 75%).

Frequently Asked Questions About Reverse Mortgage Eligibility

Does every borrower have to be aged 62 or older? Answer à If a couple is married, and one spouse is 62 or older and the other spouse is younger than 62, you can do the loan and both spouses can live in the home until they both pass away or move out permanently.

  1. If my house is free and clear, can I still get a reverse mortgage? Yes, one can still get a reverse mortgage if their home is free and clear.
  2. If I have a loan on my house, can I still get a reverse mortgage? Yes, one can still get a reverse mortgage if they have a loan on their house now (equity requirements apply).

Obviously, there is more to it, but if you meet these very basic reverse mortgages eligibility requirements, there’s a chance this loan might work for you.

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 

www.reversemortgageloanadvisors.com

Jul 292014
 

Reverse Mortgage Payment Plan Options – What Options Do I Have With A Reverse Mortgage?

Reverse Mortgage Payment Options

Reverse Mortgage Payment Options

 In recent years the most popular payment plan option for a reverse mortgage has been to take the lump sum payment at closing.  However, there are numerous ways a reverse mortgage applicant can take their money.  It’s important to do what’s right for YOU given your financial objectives.  The different ways are as follow:

  1. Lump Sum payment

    – You have the option to take 1 lump sum payment at closing.

  2. Line Of Credit

    – You can leave all of your money or a portion of your money in a line of credit to use when and how you see fit.  The nice thing about a line of credit is that your available credit grows based on your note rate plus 1.25%.  The line of credit is also guaranteed to never be cut down or shut down for as long as you live or for as long as you live in your home.

  3. Tenure –

    You can also receive fixed monthly payments for as long as you live or for as long as you live in your home.

  4. Modified Tenure

    -You’ll also have the option of selecting a monthly payment that’s lower than your standard tenure payment, but will also have a line of credit for you to use at a later date.

  5. Term

    – Another reverse mortgage payment plan option is one that allows you to choose a set length of time or dollar amount for your monthly payment.  Note, if you select an option that allows for a larger monthly payment than your allotted tenure payment, then it may not continue until you pass away.

  6. Modified Term

    You have the option to receive a payment monthly for a fixed period of time and for a fixed dollar amount and a line of credit for as long as you remain in your home.

  7. Partial Lump Sum

    You will also have the option of taking just part of your benefit as a lump sum payment.  The remaining monies are distributed using one of the other aforementioned payment plan options.

In terms of the payment plan options available for a reverse mortgage, the program is extremely malleable and can be customized to suit your needs based on your financial objectives.

For your free Reverse Mortgage California brochure and / or a Benefit Proposal custom tailored for you, please email slvReverseMortgage@gmail.com   OR shawnv@ReverseMortgageCalifornia.biz

Shawn Vaillancourt

NMLS 387151

(714) 271-8524

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

www.reversemortgagecalifornia.biz 

Reverse Mortgage Loan Advisors

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