Tag: retirement planning

How to Alleviate HELOC Payment Shock with Reverse Mortgage

Posted on by janjordan

Reverse Mortgage Colorado Financial Planning
At the peak of the housing boom thousands of Loveland and Fort Collins homeowners tapped into their biggest asset – their home – and took out a home equity line of credit or a HELOC.  Many of these loans are set to amortize after 10 years, meaning these borrowers are about to see some serious payment shock as their loans readjust and their payments now include interest and principal.  The Office of Comptroller of the Currency estimates that 60% of all HELOC balances will start amortizing between 2014 and 2017, and resetting to higher payments could cause a jump in delinquencies.  In addition, analysts at Moody’s Investor Services are warning banks of impending losses, worrying this situation may prove problematic, just as payment adjustments during the 2008 housing crisis did.

 

For retirees already living on a fixed income, borrowers may scramble to make these adjustments fit into their budgets.  But homeowners 62 and over have another option – reverse mortgage.  With a reverse mortgage seniors have the ability to not only alleviate any impending HELOC payment shock but also live mortgage payment free throughout retirement – all with minimal income and credit requirements.  Once a homeowner has obtained a reverse mortgage, they are able to receive their funds in a one-time lump sum or as monthly payments made directly to them.

 

This scenario is also something to consider for homeowners currently considering a HELOC to make home repairs or improvements.  Considering the difference between a home equity loan and a reverse mortgage is important when developing a long term plan.  Learn more about HELOC vs Reverse Mortgage here.
Jan Jordan is a Reverse Mortgage Specialist serving the Fort Collins, Loveland, Greeley, and Front Range areas of Colorado. Click here to contact Jan and learn if reverse mortgage is right for you.

 

A Retirement Crisis by the Numbers

Posted on by janjordan

colorado reverse mortgage fort collins denver loveland greeley windsorNumbers are being released showing that the impending retirement crisis may be worse than originally thought.

 

Half of Americans have less than $10,000 in savings.  Nearly half of the oldest Baby Boomer generation have insufficient resources to pay for basic retirement living expenses and healthcare costs.

 

The Center for Retirement Research at Boston College estimates that our “retirement income deficit” is $6.6 trillion. That number represents the gap between pension and retirement savings that American households have today and what they should have to maintain their standard of living in retirement.

 

Over 6 million American seniors are living in poverty.  This number is expected to grow by 33% by the year 2020.

Continue reading “A Retirement Crisis by the Numbers” →

Reverse Mortgage Changes Opens Doors of Opportunity

Posted on by janjordan

Reverse Mortgage Loveland Fort Collins Denver Boulder Longmont Greeley ColoradoSince the reverse mortgage industry saw big changes earlier this year, financial planners, retirement specialists, and lenders are collaborating more than ever before.  In an effort to ensure these revisions 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, with minimal income and credit requirements.

 

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, and Front Range areas of Colorado as well as Cheyenne and Laramie, Wyoming.

Reverse Mortgage and the Housing Supply

Posted on by janjordan

Married Couple and their Reverse Mortgage
With the baby boomer generation coming of age, we’re seeing a noticeable shift in how seniors exist in today’s society.  No longer are the days of nursing homes and wheelchairs, or moving in with adult children.  Many of today’s seniors are more independent than ever before, outliving the elderly of yesterday by leaps and bounds.  But this trend is creating a new scenario across the United States – demand for independent, affordable, and accessible housing.  According to the Census Bureau stats, the population of Americans over age 65 increased by about five million between 2000 and 2010 and over the next 20 years, the aging of the Baby Boom generation will cause the senior population to grow by 30 million!

 

Although many face challenges to some degree, most elderly Americans want to remain in their home.  Those who feel the need to move, still prefer to remain in an independent residence, usually just closer to family or without stairs.  And senior housing communities are gaining in popularity for socially active retirees who thrive in a community situation.  The options are vast – and will continue to expand as the demographic does.

 

Reverse mortgage is an accessible and viable option for many of these seniors aged 62 and older, and with minimal income and credit requirements.  A reverse mortgage can be used to stay in a current home throughout the aging years while living mortgage payment free – OR – can be used to purchase a new home and still live mortgage payment free.  As seniors take control of their housing situation and become more proactive about their futures, they will find an opportunity exists to ensure a financially stable future, while maintaining their independence, health, and dignity.

 

To learn more about obtaining a reverse mortgage on your current home, click here.  And to learn about using a reverse mortgage to purchase a new home, click here.

 

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.

Marisol Senior Living Community in Loveland, Colorado

Posted on by janjordan

Marisol Senior Living Loveland Colorado - Reverse MortgageI recently had the honor of contributing to a piece in “At Home“, the real estate insert included in Loveland’s Reporter Herald newspaper.  This piece highlighted a beautiful senior community called Marisol Senior Living located in south-west Loveland and I was pleased to discuss the reverse mortgage options available.

 

About Marisol Senior Living

 

Marisol is a 35 acre living community designed for seniors 55 and older.  Housing options within the community include apartments, duplexes, and single family homes.  With varied programs, a fitness center, free continental breakfast, bike trails and much more, this community is all inclusive for those wishing to socialize and stay busy year round.  In addition, northern Colorado has long been considered one of the best places to retire in the nation – making Marisol even more attractive.

 

Using Reverse Mortgage to Purchase

 

Conventional financing is often the first stop when considering purchasing a new home, but at Marisol, reverse mortgage for purchase options are available for seniors 62 and older, with no income and credit requirements.  Often times seniors will have substantial equity in their current home, but be leery of taking out a new loan and managing monthly mortgage payments, thus they stay in a home that no longer meets their needs.  A reverse mortgage can be a great way to get into a new home without these worries.  When purchasing a new home with reverse mortgage the down payment is determined based on the purchaser’s age and the value of the home and all loans are backed by the FHA.  Learn more about how reverse mortgage can be used to purchase a home here.

 

For more information about obtaining a reverse mortgage in the Marisol Community or elsewhere, please don’t hesitate to contact me at (970) 646-8908 or via email here.

 

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.

Changes to Reverse Mortgage

Posted on by janjordan
Reverse Mortgage
Reverse Mortgage

 

I was recently informed that upcoming changes to the FHA Insured Reverse Mortgage program will reduce the amount of proceeds our clients will receive from the loan. FHA may increase rates which, in turn, will decrease proceeds.

 

In addition, lenders have been notified that there will be stronger qualifying guidelines in the form of a financial assessment. This change may result in taking into account FICO scores, assets, tax and insurance escrows and limiting the amount of draws a customer can take from the loan.

 

The official guidelines should be out any day and will take effect on October 1, 2013. Counseling and application would have to be completed by the end of September to qualify for existing program guidelines.  If you are interested in the FHA-Insured Revers Mortgage, now may be the time to take a second look before the new changes are implemented and qualified funds reduced.

 

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.  Click here to contact Jan and learn if reverse mortgage is right for you.

FAQ’s about Reverse Mortgage for Purchase

Posted on by janjordan

reverse mortgage colorado fort collins loveland

 

In a recent blog article, I discussed the various options to use reverse mortgage to purchase a home.  One of those options is the Reverse Mortgage for Purchase program (aka HECM for Purchase).  This is an excellent option to acquire a home in Fort Collins, Loveland or Greeley, Colorado – and offers flexible options for varying situations.

 

In this article I’m going to answer some frequently asked questions regarding this program.

What is needed to qualify for a Reverse Mortgage for Purchase loan?

  • you must be age 62 or older (each borrower on title must meet this criteria, although others residing in home do not)
  • the home you are purchasing must be your new primary residence
  • credit and income are irrelevant
  • you must have your “required investment” (down payment) from a HUD allowable source. The funds cannot be borrowed. The required investment can come from the sale of a currently owned asset or money you have had for at least 90 days.

Who owns the home that I am purchasing?

 

As the borrower and homeowner, you will always retain the title to the home, just like any other type of home loan.

What will my personal ongoing obligations be after purchasing a home?

 

It’s very similar to if you owned your home free and clear – you will NOT have a monthly mortgage payment.  But as the homeowner, you will be responsible for paying property taxes, home owner’s insurance, HOA fees when applicable, and basic upkeep including home maintenance and utility payments.

When will the loan become due and payable?

 

With a Reverse Mortgage for Purchase the loan does not reach “maturity” until:

  • the last remaining borrower passes away
  • the homeowner sells the home
  • the last remaining borrower leaves the home for 12 consecutive months due to illness
  • the homeowner defaults on property taxes or insurance

Will I need to sell my my current home residence to qualify?

 

Simply put, no. As long as the loan on your current residence is not an FHA loan and your required investment comes from a HUD allowable source, you can keep your current residence – although it will need to be your primary residence. Your lender will ensure you are financially stable enough to support the ongoing obligations on all properties you own. If you decide to keep your current residence as an investment, rental, or vacation property – or you are awaiting the sale of home, it is rarely a problem.

What types of properties can I purchase?

 

Single family homes, town homes, and FHA approved condos are all eligible properties. The home being purchased will need to be the buyer’s primary residence.

Can I use the loan to build a new home?

 

These loans cannot be used as construction loans. Homes must have a Certificate of Occupancy issued before a loan application can be started

How is the “Required Investment” amount determined?

 

The “required investment” or down payment is determined by a calculation set by HUD based on:

  • The lesser of the sale price or appraised value
  • The age of the youngest of the borrowers
  • The current expected interest rate

What may disqualify me from a Reverse Mortgage for Purchase loan?

  • Foreclosures within the past 3 years.
  • Unresolved bankruptcy
  • Unpaid Federal obligations – i.e. federal taxes, defaults on prior government backed loans (such as student loans or government backed mortgages)
  • Income too low to support multiple properties
  • Unpaid judgments or tax liens

What is the HUD required “Reverse Mortgage Counseling”?

 

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.

 

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.  Click here to contact Jan and learn if reverse mortgage is right for you.

How to Purchase a Home with Reverse Mortgage

Posted on by janjordan
Colorado Reverse Mortgage
Colorado Reverse Mortgage

There are many reasons a senior may want to purchase a new home versus staying in an existing home.  Possibly they want to move closer to town or to family, or eliminate stairs, or reduce size and upkeep.  As long as they are 62 years or over, the Reverse Mortgage for Purchase Program could be the right fit.  Regardless of the reason, many northern Colorado seniors have family in the Fort Collins areas, as well as Cheyenne and Laramie, Wyoming – and getting situated then staying put is important to them.

 

There are three ways to use a reverse mortgage to purchase a new home or even build a home to their own specifications.

 

Here’s a brief run down of how each works:


Option 1: Buy with cash, then utilize a Reverse Mortgage

 

This option is quite simple. Using cash the borrower has, they purchase a home or have a new home constructed.  Once the home is occupied they will utilize a reverse mortgage, allowing them to live mortgage payment free. In order to qualify for a reverse mortgage on a newly constructed home, the home owner must have the certificate of occupancy.  Often the homeowner will need to liquidate assets or tap into savings in order to purchase the home, but once the purchase or or new construction is completed they can then take out a reverse mortgage on the home, filling the reserve that was used to make the initial purchase, and live payment free.   A downside to this option – the homeowner would likely incur settlement and closing costs twice.

 

Option 2: Buy with a Reverse Mortgage

 

With the Reverse Mortgage for Purchase Program, a senior can sell their current home, purchase a new home, and obtain a loan for the new residence and a reverse mortgage at the same time with only one set of settlement fees.  And if a senior is not currently a homeowner but wants to be, the Reverse Mortgage for Purchase Program can help them purchase a home, even if they are a first time home buyer with limited income and credit. A downside to this option is that it cannot be used to construct a new home,  but can be used to purchase a newly constructed home that has never been lived in before.  The homeowner must also take residence in the home within 60 days of purchase.
When utilizing this program, seniors will need to have the means to pay the difference between the sale price of the new home and the maximum amount they can draw on the reverse mortgage, essentially requiring a down payment. Often this down payment comes from the sale of a previous residence.  But – the homeowner will live in their new home free of a mortgage payment.

 

Option 3: Take out a conventional loan on a new home then utilize a Reverse Mortgage

 

If a homeowner is looking to have a new home constructed to their own specifications, but doesn’t have the funding to buy with cash, this becomes an option.  Once the purchase or new construction is complete, the senior homeowners would be eligible for a reverse mortgage and can live payment free in this new home.  Downsides to this option include: the borrower would likely incur closing and settlement costs with each loan, and there would be income and credit limits as with any conventional home loan.

 

With any of these options, the homeowner will always retain the title to their home.  The Reverse Mortgage for Purchase program is backed by the FHA and is highly under-utilized.  Talk with a reputable lender to learn more or to have your questions answered.

 

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.  Click here to contact Jan and learn if reverse mortgage is right for you.

How Reverse Mortgage Works in Fort Collins, CO

Posted on by janjordan

reverse mortgage colorado loveland fort collinsThe beautiful areas of Fort Collins and Loveland, Colorado are home to many retirees and seniors.  Year after year, this area makes news as one of the best places in the nation to retire.  Elderly adults stay active, family loves to come visit, and with over 300 days of sunshine per year, it’s hard to ever want to leave!

 

Now, imagine living in your home mortgage free, or enjoying monthly proceeds for life, both scenarios benefiting from the years you’ve invested in your home. A reverse mortgage is a unique tool designed for seniors 62 and older regardless of income or credit. You enjoy access to part of the equity in your home and the freedom and comfort of the home you’ve known for so many years. It’s your home, now you can put it to work for you.

Continue reading “How Reverse Mortgage Works in Fort Collins, CO” →

Fulfilling Dreams with Reverse Mortgage in Fort Collins, CO

Posted on by janjordan

Reverse Mortgage Colorado Fort Collins Loveland Windsor Longmont GreeleyI recently ran across a hard hitting article titled “Do I Have to Die Early to Avoid Poverty?”.  What a powerful title.  But the truth is, I meet people everyday who are forced to ask this questions of themselves.  Our whole lives, we work hard, raise a family, save for retirement, hope we’re blessed enough to watch our grandchildren and even our great-grandchildren grow – but then for many, as we age, the thought of funds running out before we die becomes a looming worry.  Often, regardless of strategic retirement planning, the elderly live on a strict budget with monthly allotments of funds and will have calculated that based on the age they will likely pass away.  But what if they are lucky enough to live beyond these projections?

 

Using reverse mortgage as a retirement planning tool can make a world of difference for those wishing to live fulfilling lives and not face the scenario described above.  Sometimes this looks as simple as supplementing income to make sure everyone is comfortable throughout the golden years.  Other times it means drawing from reverse mortgage in a lump sum with the desire to spend it on family while the borrower is still alive and can reap the personal rewards, instead of waiting until after they’ve passed to distribute inheritance.  Other times it can be the lifeline to prevent savings from running out and fearing ending up in poverty if they’re blessed enough to live a long life.

 

Reverse mortgage is available to homeowners (single, widowed, or married) 62 and over regardless of income or credit.  Funds can be distributed monthly or in a lump sum – and can be used for any purpose the borrower sees fit.  Reverse mortgages are also more frequently being utilized as a retirement or financial planning tool as planners are working with reputable lenders to ensure their clients are fully informed of their options.

 

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