Reverse Mortgage Info Archives - Colorado Reverse Mortgage Specialist

Category: Reverse Mortgage Info

Preparing For A Reverse Mortgage Appraisal

Posted on August 25, 2023September 6, 2023 by janjordan

After you fill out the application for a reverse mortgage, with the help of a trusted and reputable reverse mortgage specialist, an appraisal of your home needs to be conducted.

This can be a nervous moment to have a stranger come into the home you have enjoyed for many years for the purpose of evaluating it. Since you may not know what to expect you might even wonder if they are going to ask questions you cannot answer, or notice the cleanliness of the refrigerator.

There are many steps you can take before the appraiser comes to your home. IF you take a little time the value will increase and the appraiser will only have to make one visit instead of numerous ones because you had work to do.

Here is a list of the types of questions to honestly ask yourself and if your answer to any of them is yes, fix it before they arrive.

• Do you have exposed electrical wires? Or faulty electrical?

• Are there staircases or decks without rails or in poor condition?

• How is your paint looking? Inside AND outside.

• Do you have any water leaks?

• What is the status of your roof, are there any leaks or damage?

The better shape your home is in when the appraiser comes, the better the listed value will be and the more money will be in your pocket from your reverse mortgage loan.

Maybe you are looking for a loan for the sake of repairs, as a senior this kind of help is possible for you just ask your lender for more information so the focus of the loan is included.

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.

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.

Think You’re Too Old For A Reverse Mortgage? Think Again.

Posted on August 4, 2023August 28, 2023 by janjordan

The minimum age for a reverse mortgage loan is 62, but what about a maximum age? Is anyone ever too old for a reverse mortgage? I don’t think so, although it won’t be right for everyone.

Reverse mortgages are available to homeowners, or those seeking to purchase a home, who are 62 and older, including married couples. There are NO loan or mortgage payment requirements while living in the home, but they are responsible for continuing to pay property taxes, homeowners insurance, and any other associated costs such as HOA fees and utilities. The loan becomes due when the last borrower passes away or permanently leaves the home (for 12 consecutive months).

Common reasons for seeking out a reverse mortgage include boosting retirement income, strategically protecting retirement assets or delaying the use of them, medical care, or simply to have a safety net. The creative uses for reverse mortgages go full circle. But what about the very elderly? How can it help them?

I once worked with a 100 year old man to obtain a reverse mortgage on his home and fund in-home care while he continued to age. He was able to reside at home with 24 hour care at a cost of $10,000 a month. When I was sitting at the closing table with this client and his lawyer, the lawyer mentioned that that he could move to an assisted living facility at half the cost ($5,000/month). This gentleman’s quick, sharp answer back to everyone? “NO…. I’m staying in my home.” And he did. And I was honored to have helped him be able to do that.

Another example would be if a parent-adult child duo were living together as they both age. In many of these cases, it’s common both are age eligible to be on the loan. And why shouldn’t they be?

Sometimes the elderly want to live out the final years of their life by sharing time and gifts with those they love. Why not offer inheritance while you’re here and can enjoy watching those you love reap the rewards of it?

Whatever the reason, reverse mortgage may be the answer, no matter how old the borrower is.

One concern that can arise is whether or not the elderly can pass the financial assessment needed to obtain the reverse mortgage loan, since they likely have limited income by this point. But older borrowers can tap a larger percentage of their home’s equity, allowing for a potential set-aside of funds to cover required expenses. The reason is that their life expectancy is shorter, meaning the expected term of their loan will be shorter, too.

Don’t Fall Victim To Reverse Mortgage Scams

Posted on July 28, 2023August 28, 2023 by janjordan

You may hear about email scams, telephone scams, door-to-door soliciting scams – but what about reverse mortgage scams? Unfortunately just as we have scams in every segment of society and at every opportunity, reverse mortgages and seniors are not immune to such activity.

In the past decade, reverse mortgages also known as Home Equity Conversion Mortgages (HCEM), have increased more than 1,300 percent! This certainly offers an astounding opportunity for fraud perpetrators.

What do reverse mortgage scams look like?

Victims may be offered a free home, an investment opportunity, or foreclosure and refinance assistance. Senior citizens are often unsuspecting targets for scammers, as they are not familiar with the multitude of unscrupulous and dishonest “programs” that exist. Scammers reach their victims often through churches, investment seminars, television, radio, billboard, and mailer advertisements.

When considering a reverse mortgage product, it is very important to research the company. Most reverse mortgages are insured by the Federal Housing Authority (FHA). Seek out companies that are a member of the Better Business Bureau and associated with the National Reverse Mortgage Lenders Association.

Tips for Avoiding Reverse Mortgage Scams:

• Do not respond to unsolicited advertisements.
• Be suspicious of anyone claiming that you can own a home with no down payment.
• Do not sign anything that you do not fully understand.
• Do not accept payment from individuals for a home you did not purchase.
• Seek out your own reverse mortgage counselor.

What’s So Great About a Reverse Mortgage Line of Credit?

Posted on July 21, 2023July 27, 2023 by janjordan

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?

Cash Purchase Or Reverse Mortgage For Purchase: Weighing Your Options

Posted on July 7, 2023July 27, 2023 by janjordan

In this day and age, buying a home with cash is rare. And not because of the reasons you may think – such as who has that much cash nowadays? Well, that is part of the reason, but it’s a little more complicated than that. Those who have a substantial amount of cash are finding there are no homes available in their price range and suddenly they don’t have enough cash to be a true “cash buyer”. This diminishes their hopes of living mortgage payment free. For example, if a retired couple sells their home or allots other funds amounting to $250,000 for a new home, they will suddenly be facing a new dilemma – finding a home to meet their needs, that doesn’t need repairs, and is in the community they wish to live. With home prices dramatically increasing in the across Northern Colorado, this scenario is playing out ever more often.

This is where the Reverse Mortgage for Purchase program can provide a solution. Not only will the program add funds to the buyer’s available cash making up the difference needed to purchase an appropriate home, it will also allow that buyer to live mortgage payment free. In addition, putting all your cash into one asset can be a scary thought, especially later in life when the future is largely an unknown, and security is a necessity. When adding a reverse mortgage into the equation, cash home buyers can consider keeping some of the cash or invest it elsewhere.

Here’s how it works:

For seniors 62 and over, home buyers are able to use a reverse mortgage to purchase a home. The amount of the down payment required from the buyer will depend on the amount of the home they are purchasing. But unlike a conventional loan, not only will the lender provide the funds to make up the difference between the home price and the down payment, the buyers will be able to live mortgage payment free for as long as they remain in the home. This frees up income for other things – such as secure retirement living, medical expenses, in home care, vacations, or anything else they may desire. A Reverse Mortgage for Purchase can be used to buy single family homes, town homes, and FHA approved condos. New construction can be purchased, but it must have a Certificate of Occupancy before the loan application can be accepted. The home being purchased will need to be the buyer’s primary residence and the required down payment will need to come from a HUD approved source. And just like a conventional mortgage, the buyer will always retain the title to the home.

A Look At What Seniors Want In Housing During Retirement

Posted on June 30, 2023July 5, 2023 by lesley

If you find yourself yearning for a retirement of comfort in your own home in a community you love, you are definitely not alone. Here are some pretty telling facts and statistics surrounding the desires of older adults in the U.S..

According to research by the American Association of Retired Persons (AARP):

Nearly 90 percent of seniors want to stay in their own homes as they age.
Even if they begin to need day-to-day assistance or ongoing health care during retirement, 82% would prefer to stay in their homes.
Most pre-retirees expect they will be able to live independently during retirement; only 14% expect they will need day-to-day assistance or ongoing health care at any point during their retirement.
Thinking about parents’ getting older is on the minds of 88% of adult children.
75% of adult children and 69 % of parents think about the parents’ ability to live independently as they get older
AARP identified housing features that seniors find are especially important in the later years:
– Safety features such as non-slip floor surfaces (80 percent)

– Bathroom aides such as grab bars (79 percent)

– A personal alert system that allows people to call for help in emergencies (79 percent)

– Entrance without steps (77 percent)

– Wider doorways (65 percent)

– Lever-handled doorknobs (54 percent)

– Higher electrical outlets (46 percent)

– Lower electrical switches (38 percent)

From the National Assocation of Home Builders:

75% of remodelers report an increase in inquiries related to aging in place.
The NAHB predicts that aging in place remodeling market to be $20-$25 billion. That’s about 10 percent of the $214 billion home improvement industry.

According to the MetLife Mature Marketing Institute:

91% of pre-retirees age 50 to 65 responded that they want to live in their own homes in retirement. Of that group, 49% want to stay in their current homes, and 38% want to move to new homes

Whether it’s the desire to simply stay put through retirement, or to make modifications to the home, or even to purchase a new home, a reverse mortgage is a flexible tool to help finance any of these.

Reverse mortgages are available to homeowners 62 and over, including married couples, with many protections in place to ensure borrowers are adequately educated before using this option, such as required third-party counseling. Reverse mortgages are gaining in popularity among retirees from all walks of life. A reverse mortgage for purchase option is available for those looking 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, as well as the Cheyenne and Laramie communities of Wyoming. Contact Jan and learn if reverse mortgage is right for you.

As Gray Divorce Rates Are Climbing A Reverse Mortgage May Help

Posted on June 27, 2023July 5, 2023 by janjordan

A new research poll highlighted a very interesting trend among divorce in the United States – while divorce rates have drastically declined among younger adults, it’s nearly doubled among adults 50 and over in the past 25 years.

The truth is, it’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 lasts 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.

What To Know About Reverse Mortgages With Social Security, Medicare & Pension

Posted on June 13, 2023July 5, 2023 by janjordan

A very common concern among seniors and adult children when considering a reverse mortgage is how it will affect social security, medicare, and even certain pensions. For many seniors, these benefits are a large part of their income. Fortunately, because the funds from a reverse mortgage are NOT considered taxable income, a borrower’s benefits will not be affected when taking out a reverse mortgage.

On the other hand, borrowers who have Medicaid, TANF, Food Stamps or SSI may see those benefits affected by this additional income. Because these programs are government sponsored programs with strict approval guidelines based on all sources of income, even non-taxable income, there is a possibility the additional cash flow will need reported. Other supplemental and assistance programs would need to be addressed on a case by case basis. Working with a reputable reverse mortgage lender and required third party counseling will ensure all your questions are answered thoroughly and honestly.

Reverse mortgages are available to homeowners 62 and older. The proceeds can be received as a lump sum, as monthly installments, or a reverse line of credit and can be used for any purpose the borrower sees fit. This FHA insured loan allows the borrower(s) to live mortgage payment free.

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

Reverse Mortgage Counseling: What To Expect

Posted on June 6, 2023July 5, 2023 by janjordan

Prior to being approved for a reverse mortgage, HUD’s Federal Housing Administration (FHA) requires each borrow to participate in a counseling session with an approved agency. These not-for-profit agencies are funded by the federal government and work closely with both the FHA and lenders to ensure a smooth process.

The goal of this session is not to steer a potential borrower in one direction or another, but to make sure they clearly understand all aspects of a reverse mortgage.

Here is what you can expect at your counseling session:

The potential borrower will need to schedule an appointment directly with a counseling agency. The lender does not initiate or take part in the session, but can provide you with resources to seek out a counselor. The session will take place in person or over the phone – although the FHA recommends a face-to-face meeting whenever possible.

Prior to your appointment, the counseling agency will provide you with a packet of information to allow you to prepare for the session. During the session the counselor will discuss your immediate and long-term financial needs, your reasons for seeking out a reverse mortgage, address any questions or concerns you may have, and clearly educate you on the process as well as the pros and cons of a reverse mortgage. Again, they are not there to “sell” you on the product, but to educate instead.

Once you have completed the counseling session, you will be provided with a “Certificate of Completion”. This certificate verifies to your lender that you have completed the counseling session and that you understand the essentials of a reverse mortgage. Your counselor will also follow up with you to ensure you have no further needs, questions, or concerns.

Here’s Where To Start If You’re Considering A Reverse Mortgage

Posted on May 30, 2023June 5, 2023 by janjordan

reverse mortgage loveland fort collins greeley longmont westminster colorado Every month thousands of Americans make a decision to obtain a reverse mortgage, but where do they start? Here are my suggestions to begin the reverse mortgage process, as well as an outline of what to expect.

Research: Begin by researching reverse mortgages to understand how they work, their benefits, and potential drawbacks. Educate yourself on the eligibility criteria, loan types, repayment requirements, and any associated costs. This will help you make an informed decision.
Consult with Professionals: Consider consulting with a financial advisor or an elder law attorney who can review your financial situation and provide personalized advice. They can help you assess whether a reverse mortgage aligns with your long-term financial goals and explore any legal or tax implications.
Find Lenders: Identify reputable lenders who offer reverse mortgages. Look for those approved by the Federal Housing Administration (FHA) or other relevant regulatory bodies. Compare lenders based on their reputation, ties to the community, information, and customer reviews. It’s advisable to select a lender with specific experience in reverse mortgages.
Gather Information: Once you’ve chosen potential lenders, contact them to request information and application materials. They will provide you with details about their specific reverse mortgage products, requirements, and the application process. The reverse mortgage professional you choose should be easy to get a hold of, knowledgeable, and able to answer any and all questions.
Seek Counseling: Counseling is a mandatory step in the process and is designed to provide you with unbiased information and guidance. The counselor will evaluate your financial situation, discuss alternatives, and help you determine if a reverse mortgage is the right choice for you.
Application Process: Begin the application process with your chosen reverse mortgage professional and lender. You will need to provide various documents, including identification, proof of homeownership, income verification, and information about outstanding mortgages or liens on the property. The lender will guide you through the specific documentation requirements.
Home Appraisal: The lender will arrange for a professional appraisal of your home to determine its current market value. This step is necessary to calculate the maximum loan amount you may be eligible for.
Loan Approval and Closing: After reviewing your application, financial assessment, and appraisal report, the lender will decide whether to approve the loan. If approved, you will proceed to the closing process. During closing, you’ll sign the necessary documents, including the loan agreement and any other legal paperwork.

Remember to take your time, ask questions, and carefully review all the details before proceeding. It’s important to fully understand the terms and conditions of the reverse mortgage before making a decision.

Reverse mortgages are available to homeowners 62 and over, including married couples. Reverse mortgages are gaining in popularity among retirees from all walks of life. A reverse mortgage for purchase option is available for those looking to purchase a new residence.