Month: April 2015

Unraveling The Myths Around Reverse Mortgage

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Reverse Mortgage was created to give our retiring generation a way to keep their homes and manage the ever increasing costs of life in America 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, unravel the myths floating around about what reverse mortgage is and 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.

 

 

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.
 

 

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.

Adult Children and Reverse Mortgage in Longmont, Colorado

reverse mortgage colorado fort collins loveland greeleyWhen your parents move into this stage of their life there may be many considerations for them, their comfort, and your relationship to them. During the discussion process the option of reverse mortgage is a good one to consider. The equity from their home can be turned into available resources.  This will help make it possible to either move to a smaller place, easily take care of home costs while other savings can be used for both enjoyment and medical, or even move closer to you and your kids.

 

There are quite a few common concerns that will arise. Here are short answers but speaking with a reputable reverse mortgage agent will be to your advantage if you need more information.

 

Will the bank own their home if my parents take out a reverse mortgage?

 

No. Your parents will continue to own their home and retain the title throughout the entire reverse mortgage.

 

When the loan has to be repaid how much will be owed?

 

This amount will be outlined up front before they sign the dotted line. They, or those that are the beneficiaries, will owe the amount borrowed, accumulated interest, servicing fees, accrued mortgage insurance premiums, and any costs and fees financed through the amount of the loan.

 

How is the loan repaid the loan if it comes due?

 

There are three options. They can use their own resources, refinance the loan, or sell the house to repay the lender. A reverse mortgage is designed, however, to make it possible for them to live payment free for the remainder of their lives.

 

FHA insured reverse mortgages are available to homeowners 62 and older with no credit or income requirements until April 27th, 2015 (at this time some changes will take place to the qualifying process). These loans allow the borrower to live mortgage payment free and receive their loan payment in one lump sum or in monthly installments.

 

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.

Retirement on the Horizon with Reverse Mortgage

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Retirement was once considered a “golden age” in decades past. It was held as a time for you to relax and enjoy life after years of hard work for your family and your assets. This can still be possible, even in the ever changing society with it’s unexpected expenses.

 
Reverse mortgage could be the way for you to fulfill your long held desires.

 

In years past reverse mortgage was not often considered by financial planners when helping those approaching 62 manage the pieces of their retirement lifestyle – including social security, assets, savings, and all the rest. This has changed.

 
Reverse mortgage is a strong viable option even in the phase of financial planning. The equity that builds up in the home could rightly be accessed to give you security at the least and make the difference between just making your monthly bills to actually enjoying your life in new ways.

 
This being the case, a reverse mortgage or HECM (Home Equity Conversion Mortgages) should be a part of the conversation. When choosing a financial planner, find out if they have learned about reverse mortgage options.  Seek a planner that has worked with a credited reverse mortgage specialist that is part of the Better Business Bureau, is an active part of the local community, and is a member of the National Reverse Mortgage Lenders Association (NRMLA).

 
Involve your children in the process. Find out what they want, express to them what you want and keep the dialogue going.

 

Reverse mortgage is an individualized, specialized loan for those 62 and older.  If you are planning ahead let your specialist guide you in the many scenarios that are possible. Think creatively about 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.  Click here to contact Jan and learn if reverse mortgage is right for you.

Taxes and a Reverse Mortgage in Colorado

reverse mortgage loveland colorado fort collins longmont greeley boulderSpring has sprung in Fort Collins and Loveland again!  That’s the good news.  The bad news is this also means it’s tax time.  It’s common during this time of year for me to receive a few questions regarding taxes and reverse mortgage – from both those considering a reverse mortgage, and those who already have a reverse mortgage.

 

Here are the two most common:

 

Are the funds from my reverse mortgage considered taxable income? 

 

No.  Because the funds received from a reverse mortgage are technically an advance on a loan, any payments or lump sums received are not taxable income, meaning they do not need to be reported on a tax return as such.  They also typically do not affect Social Security or Medicare payments.

 

Is the interest from my loan deductible? 

 

No.  Because reverse mortgage holders do not make monthly mortgage payments and typically the interest is not paid until the loan is paid in full, the interest from a reverse mortgage loan is not deductible on a tax return.  This is also the case with a reverse mortgage for purchase loan.

 

FHA insured reverse mortgages are available to homeowners 62 and older with no credit or income requirements until April 27th, 2015 (at this time some changes will take place to the qualifying process).  These loans allow the borrower to live mortgage payment free and receive their loan payment in one lump sum or in monthly installments.  All borrowers are required to participate in third party counseling to ensure all their questions are adequately answered before making a decision.  Reverse mortgages are also available to purchase a new residence.

 

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.