Category: Reverse Mortgage Info

Reverse Mortgages Can Help Widows Purchase A Home

reverse mortgage loveland fort collins greeley longmont westminster coloradoIt’s a scenario all to familiar for the elderly in Northern Colorado…

A spouse passes away leaving behind a widow.  The remaining partner wants to move closer to family.  But there’s a catch – although the widow’s current home is owned outright, they would typically need to sell it before they could purchase another.   And they wish to move to an area where the median home price is much higher than the home available to sell.

Reverse mortgage for purchase may be an excellent option for this widow.  Let’s look at the scenario in detail:

Predicament #1: Widow needs to sell current home before purchasing a new home.

Solution: With a reverse mortgage for purchase, this widow would not need to sell the home immediately.  Any personal funds or assets used to purchase the new home could be replenished when the current home sells – and the funds from a reverse mortgage would supplement the initial funds needed.  This would allow her to move and get settled immediately.

Predicament #2: The cost of a home in the area the widow is moving is much higher than where she currently lives, meaning the proceeds from her current home sale will not cover the entire purchase.

Solution: When utilizing a reverse mortgage for purchase, her out of pocket cost would be substantially supplemented.  For example if she anticipates selling her current home for $200,000 and purchasing a home for $300,000, the reverse mortgage may cover the $100,000 difference allowing her to live mortgage payment free and best of all – near her family.

Reverse Mortgage for Purchase (aka: HECM for Purchase) is an FHA insured program for seniors 62 and over, with minimal income and credit requirements.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming.

Here’s Why The Reverse Mortgage Line Of Credit Is So Popular

The HECM Reverse Mortgage Line of Credit is still relatively new, and to this day many within the financial and retirement industries haven’t fully grasped how it works.  Well, they need to get on board because consumers are interested – and they should be.  Here’s why..

First, what is a line of credit?  Simply put, a line of credit are funds available to you through a financial institution that you can access as needed, or not at all if the need doesn’t arise.  Interest is not acquired if the funds are not used.  This makes line of credit options excellent safety nets, especially for the purpose of creative retirement strategy.

When looking at a HECM Reverse Mortgage Line of Credit, the two are obviously intertwined, meaning the qualification requirements for any reverse mortgage still apply.  These are: age 62 and over, using your primary residence for the loan, this home must meet HUD’s guidelines and needs to be either paid off or have substantial equity, and the borrower must have the financial capability to continue to pay homeowners insurance, property taxes, and the like. Because there are various options to receive the payout from a reverse mortgage, the line of credit is only one of them.

When you have a reverse mortgage line of credit, you have money that is available to you — but you only accrue interest on the money you withdraw.  This means the reverse mortgage line of credit can act as an excellent back up source of funds or can be used for retirement fun, whether it be vacation, spoiling grandchildren, or knowing you have the funds available when you’re ready to take on new ventures.

There are other benefits though.  This line of credit is pretty astounding beyond just being a safety net.

Growth: Not only are you not paying interest, but your untouched reverse mortgage line of credit can grow in value. Money in a reverse mortgage line of credit grows at the same rate as the interest rate on the loan PLUS 1.25% monthly.  So, if the interest rate on your reverse mortgage is 2.50%, then your line of credit will grow at 3.75% (2.50% + 1.25%).

Unique: This growth is unique to reverse mortgage lines of credit — a HELOC for example does not grow.

Hedge Against Falling House Prices: The growth in a reverse mortgage line of credit is guaranteed — without withdrawals, your line of credit is guaranteed to grow.  This means you lock in the current value of your home without taking out an interest acruing loan.

Pretty great, isn’t it?

Jan Jordan is a Reverse Mortgage Specialist serving the Erie, Firestone, Fort Lupton, Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you.

Can A Reverse Mortgage Help With Divorce After Retirement?

Reverse Mortgage Helping Seniors in Fort Collins Colorado Loveland GreeleyIt’s becoming more and more common for seniors to divorce after retirement.  This is happening for various reasons, but a big one is that retirement now last for decades versus only years, and many people are looking to make those golden years the best yet.

But senior divorces can get messy, as there are often many assets to sort out.  During divorce negotiations, a home is often one of these assets.  This home is possibly owned free and clear, or with a lot of equity.  For divorcees age 62 and over, a reverse mortgage can be used as a tool to help with settling this asset during divorce.  The great thing about reverse mortgage is it allows someone to stay in the home and live mortgage payment free, AND access funds from the equity.  Here are a couple scenarios in which reverse mortgage would be of benefit.

Scenario 1: When splitting the home asset, instead of selling the home, one party could be allowed to stay in the home and obtain a reverse mortgage, of which the other party receives the funds from.  This can be a win-win.  In cases like this, the financial settlement can even be wrapped into the loan if the divorce is final before the closing.  This would mean a reverse mortgage would be part of the divorce settlement discussion.  It is important to understand that the party that remains in the home will be responsible for certain obligations pertaining to the home, such as property taxes and homeowners insurance.

Scenario 2: Possibly you’re used to living off two incomes – whether it be from work, or social security and pensions.  Suddenly dropping down to one income can be devastating.  In cases like this getting the home in divorce proceedings can be a huge benefit, as once the divorce is final, a reverse mortgage could be obtained on the home.  The funds could come in monthly installments, a line of credit (that grows), or a lump sum.  In addition, if you wanted to sell the home and move, a reverse mortgage could be used to purchase the new home– and can even allow you seek homes that would otherwise not be in your price range.  The best part?  You will always live mortgage payment free.

If you are considering a divorce, or sifting through the process, don’t hesitate to contact me to further understand how reverse mortgage can help, and whether or not you qualify.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Contact Jan and learn if reverse mortgage is right for you.

Being Responsible with a Reverse Mortgage in Colorado

reverse mortgage loveland fort collins greeley longmont westminster coloradoThe Reverse Mortgage (HECM) program Colorado continues to help millions create the life of their dreams as they retire and relax into this time of their lives.  Seniors age 62 and over are eligible for this type of loan. Regardless of the type of reverse mortgage you get (traditional, line of credit, or reverse mortgage for purchase) the main advantage is the relief from monthly mortgage or loan payments, but the borrower will still have some responsibilities, including a small amount of financial obligations.

Here are the four main commitments borrowers of a reverse mortgage will continue to be required to take care of:

Homeowners Insurance

A reverse mortgage is like other conventional loans requiring the holder to purchase and maintain homeowners insurance. There are many options out there to be discussed with both the reverse mortgage counselor and the lender.

Property Tax

This too is the same as with a conventional loan. The reverse mortgage homeowner will need to pay the property tax. Depending on your financial need, assistance may be available to help pay or defer property taxes.  Your reverse mortgage specialist and your local human services office would have more information about such assistance.

Home Maintenance

Your home remains in your possession, so the maintenance of your home remains your responsibility. If you are thinking of selecting the reverse mortgage in the form of one lump sum bear in mind you need to allocate funds for future maintenance needs. This too is an excellent point to discuss with your reverse mortgage specialist or counselor.  Any applicable HOA fees also remain the responsibility of the borrower.

Utilities

All utilities, such as electricity, gas, water, and trash will remain the borrowers responsibility.

Reverse mortgage is an individualized, specialized loan for those 62 and older that allows seniors to tap into the equity of their home while living mortgage and loan payment free.  The funds can be accessed via a lump sum, line of credit, monthly installments, or even to purchase a home. If you are planning ahead let your specialist guide you creatively to suit your needs and desires.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Contact Jan and learn if reverse mortgage is right for you.

Reverse Mortgage Questions Answered for Adult Children

reverse mortgage colorado fort collins loveland greeleyAs your parents age, their needs will inevitably change. And as they change, your need to consider options with them will increase. While these conversations may be the first of their kind, it will also be a chance to offer support. Reverse mortgage could be a viable option to meet everyone’s wishes, especially your parents.

Concerns will arise. Here is a brief answer to some of them.  For more in depth answers, feel free to contact me.

• If my parents and I decide to repay the reverse mortgage loan, what happens to the equity in the home?

There are two options at this point. The first is a decision by your parents to sell the home and use the money received to pay off the reverse mortgage. The second is to keep the home and choose another way to pay the balance due on the loan. In both options, the borrowers will keep the equity that remains in the home.

• Will the home inheritance Mom and Dad have prepared for me and/or my siblings be used up?

They will be tapping into equity but their home may also be appreciating. If this is the case the appreciation will keep some equity in the home for you to receive upon their passing. This conversation with them will be the most meaningful. Oftentimes parents assume their children want an inheritance and create stress in their lives just so they leave as much as they can. Unspoken assumptions on both sides can leave everyone in the dark.  The needs of your parents, and the ability to support themselves without draining anyone else’s finances may outweigh what is received when they are gone.

They may need to know how you really feel about inheritance and your thinking about what it means to you is just as important.

• If my parents take a reverse mortgage out on their home, will it affect their retirement benefits?

This type of loan does not affect the benefits of Medicare or Social Security or other pensions, and additionally, the income is non-taxable. If your parents have other forms of assistance such as federal, state or Medicaid programs, a reputable reverse mortgage lender can help navigate this.

Reverse mortgage is an individualized, specialized loan for those 62 and older that allows seniors to tap into the equity of their home while living mortgage and loan payment free.  The funds can be accessed via a lump sum, line of credit, monthly installments, or even to purchase a home. If you are planning ahead let your specialist guide you creatively to suit your needs and desires.

Home For The Holidays and Reverse Mortgage

Reverse Mortgage Colorado Loveland Fort Collins Greeley LongmontWith Christmas now behind us, many families are reflecting on the holiday.  Adult children enjoyed spending time with their aging parents or relatives, grand children and great-grand children were squeezed and showered with adoration.  For some spending time with family is an encouraging sign of many happy years to come…but for others, it can be a time that raises concern about health or finances, and questions about how aging  parents will continue to cope.  Will this person need additional care?  Do they need a more adequate home closer to family or suitable for aging in place?  How does long term retirement look?

Concerns such as this are very common around the holidays.  To better guide you in the right direction and ultimately direct the family in the right direction, here are some questions to ask yourself:

• Are they able to get around by him or herself? Are there stairs in the home?

• Is this person able to take medications without assistance? Is there a health concern that would require more regular supervision, such as Alzheimer’s or Parkinson’s?

• Is your parent able to manage mortgage payments, home-owners insurance payments, and property taxes. Is the home outdated and in need of frequent repairs – such as a furnace, roofing, electricity?

• Where is this home located? Is it in close proximity to relatives, hospitals, etc? Or is it secluded and away from town?

• Is this person lonely? Has he or she suffered the loss of a spouse? Does he or she have a solid social group or close friends?

Based on your answers to these questions, aging at home may be an option for years to come – and reverse mortgage can be a solution to many problems even for married couples. Reverse mortgages allow homeowners age 62 and older to access equity in their home, without acquiring a loan or mortgage payment, and the funds can be accessed via a line of credit, monthly installments, a lump sum, and even as a new home purchase. The homeowner will always retain the title and remains in the home. All reverse mortgages are government insured with an FHA backed loan and no repayment is due until the last borrower passes away or permanently leaves the home. At that time there are several options that include keeping the home in the family. If selling the current residence and moving into a new home is a more reasonable route, Reverse Mortgage for Purchase may be an option.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado, as well as the Cheyenne and Laramie communities of Wyoming.  Contact Jan and learn if reverse mortgage is right for you.

Reverse Mortgage Could Be The Key To Retiring In Comfort

reverse mortgage colorado fort collins lovelandFor many who remember the reverse mortgage scares of the yester-years, the terms ‘comfort’ and ‘reverse mortgage’ seem like an unlikely duo.  But they shouldn’t  be.

Since the FHA and HUD changed a few regulations stabilizing reverse mortgages in 2015, they have quickly been garnering new attention.  Whether looking to boost monthly income, protect retirement, or even purchase a new home, reverse mortgage is proving to be a versatile and creative tool.

Here are three ways a reverse mortgage can help make retirement more comfortable:

1.) Supplement retirement income.  With a whopping 36% of baby boomers planning to live on nothing but Social Security for retirement, utilizing a reverse mortgage to supplement retirement funds with non-taxable income from the equity of an individual’s home is a great option.  The funds can be accessed via monthly payments or a line of credit, and because the loan doesn’t come due until the borrower passes away or permanently leaves the home, they can live their retirement years both financially comfortable and in the comfort of their own home.

2.) Protect and enhance retirement portfolio.  For those who have a well prepared plan for their retirement, using a reverse mortgage line of credit to supplement their nest egg can offer great flexibility and even enhance wealth.  Some simply want to use the funds to delay Social Security until they can receive the largest amount.  Others may have investments they are looking to protect or allow to mature.  Retirement and financial planners are now discussing how a reverse mortgage can be used as part of a long term retirement plan.

3.) Purchase a retirement home.  It’s still a little known fact that a reverse mortgage can be used to purchase a new home – but it can, and it’s a great fit for so many retirees.  Whether looking to moving in to a senior community, move closer to family, or move to a dream home, using a Reverse Mortgage for Purchase should not be overlooked.  This amazing program makes the once impossible possible when it comes to home buying.

Reverse mortgage is an individualized, specialized loan for those 62 and older that allows seniors to tap into the equity of their home while living mortgage and loan payment free.  The funds can be accessed via a lump sum, line of credit, monthly installments, or even to purchase a home. If you are planning ahead, let your specialist guide you and help creatively suit your needs and desires.

Jan Jordan is a Reverse Mortgage Specialist serving the Erie, Boulder, Lafayette, Fort Collins, Loveland, Greeley, Longmont and other Front Range areas of Colorado.  Contact Jan and learn if reverse mortgage is right for you.

7 Reverse Mortgage Myths That Need To Go Away

reverse mortgage loveland fort collins greeley longmont westminster coloradoReverse Mortgage was created to give our retiring generation a way to keep their homes and manage the ever increasing costs of life after working long and hard over the years. It is an option that could be just right for you. All applicants are required to participate in HUD approved counseling to ensure all their questions and concerns are addressed. Working with a reputable reverse mortgage specialist will also be critical in the process, as this person should be your advocate – even telling you when a reverse mortgage may be wrong for you.

In the meantime, it’s important to unravel the myths floating around about what a reverse mortgage is and what it does.  Here are a few myth busting facts:

 Myth #1: Reverse mortgages are only for poor people.

Fact: Many retirees use reverse mortgage as a way to fulfill their desires for retirement, or to help grandchildren with college, or even to move into their dream home.

Myth #2: It’s free money.

Fact: It is a loan specialized for those 62 years old and older that does not need to be paid back until the last borrower passes away or leaves the home permanently.  If anyone attempts to market a reverse mortgage as “free money”, beware as it is likely a scam.

Myth #3: You lose your home.

Fact: The title of your home stays in your hands.  You are always the owner.

Myth #4: It is not a safe program.

Fact: Reverse mortgages are FHA insured and fully guaranteed – regardless of how you receive the payout.

Myth #5: My equity is safe if I don’t use a reverse mortgage right now.

Fact: Your equity is dependent upon the housing market, which is always changing.  Utilizing a reverse mortgage line of credit is a great way to guarantee your reverse mortgage equity is not affected by housing booms and busts.

Myth #6: I must be a homeowner or use my current home to obtain a reverse mortgage.

Fact: Reverse mortgages can be used to purchase a home, even if you have never owned a home before.

Myth #7:  If I’m married, my spouse will lose the home if I pass away.

Fact:  Married couples can both be on the loan if both are 62 or older.  There are many ways to ensure both spouses are not at risk.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you.

Tips To Finding A Great Reverse Mortgage Lender In Colorado

reverse mortgage colorado loveland fort collins longmont greeley boulderFor many seniors, a reverse mortgage is a feasible option to living within a budget, without the constraints and worry of excessive financial distress.  In order to qualify for a reverse mortgage, the individual must own their home or have a substantial amount of equity in it and be at least 62 years old.  In general, the older the borrower (or the youngest borrower in the case of couples) and the more valuable the home, the more funds are available.  Other factors also come into play, such as: the appraised home value, interest rates, and the amount of equity in the home.  Once a basic understanding of how a reverse mortgage works, the next step is finding a lender.

Where to find a lender?

Reverse mortgages are marketed in every possible way.  Television, radio, mailers, internet, etc.  Although not all of these methods ensure trouble, some of them can be red flags.  When seeking a reverse mortgage lender, it’s important to speak with people you trust.  Ask around at your bank or financial institution.  Speak with a financial or retirement adviser.  Talk with neighbors or friends who have utilized a reverse mortgage.  Seek information from the local Chamber of Commerce or Better Business Bureau.   Utilize other resources that may be available in your community.

What to look for in a reverse mortgage lender?

Working with a reputable reverse mortgage lender is critical.  The reverse mortgage industry is riddled with scams and flashy sales.  It can be risky to get involved with a lender who does not offer all the details or who is just looking to make a “quick sell”.   A reputable lender will have strong connections in the community, working closely with a network of professional organizations.

Accreditations and ratings?

Seek out a lender that is a member of the National Reverse Mortgage Lenders Association (NRMLA).  Members of the NRMLA must conform to a strict code of lending ethic.  Look for a lender that is affiliated with the  Better Business Bureau (BBB), where you can also learn of any complaints against the company.

Follow your gut.

When it comes down to it, always follow your gut.  Just because a lender may meet all this criteria doesn’t mean they will be right for you.  If you do not feel comfortable or feel your questions are not being adequately answered, there is nothing wrong with seeking out a different lender.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado, as well as the Cheyenne and Laramie communities of Wyoming.  Contact Jan and learn if reverse mortgage is right for you.

Reversing Thinking On Reverse Mortgages

reverse mortgage loveland fort collins greeley longmont westminster coloradoSince the reverse mortgage industry saw big changes in 2015 then again in 2017, financial advisers, retirement planners, and reverse mortgage specialists are collaborating more than ever before.  In an effort to ensure these changes are are thoroughly understood and appropriate solutions are offered to clients, a strong relationship between professionals is vitally important.

Because of these newly developed relationships, it appears a wonderful shift is taking place.  Reverse mortgage, once stereotyped as a product for poverty stricken widows or the like, is now being realized as a product of opportunity.  More and more we’re seeing affluent and middle class retirees utilizing this option to provide financial stability and financial freedom throughout retirement.  The industry has only begun to scratch the surface of those who would benefit or will discover the possibilities when tying a reverse mortgage into their retirement plans.

This paradigm shift will likely increase knowledge across the board regarding both traditional reverse mortgage loans and the reverse mortgage for purchase program.  Both products are available for seniors 62 and over.

If you have any questions regarding the changes that have taken place surrounding the reverse mortgage industry in Colorado, please don’t hesitate to contact me.

Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, Longmont, Boulder and other Front Range areas of Colorado.  Click here to contact Jan and learn if reverse mortgage is right for you..