Reverse Mortgages Soar Amid Coronavirus Pandemic

Reverse mortgage is getting a second look as a possible alternative source of stability amid the coronavirus crisis, which has caused the 401(k)s to shrink away and the stock market to behave just like an oscilloscope. The growing equity that many seniors have in their property is one of the many reasons behind the reverse mortgage’s new appeal.

The National Reverse Mortgage Lenders Association said that homeowners who are at least 62 years old saw their housing wealth increase by $39 billion starting from the third quarter up to the fourth quarter of the past year, setting a new record of $7.23 at the end of the year.

The volume has increased substantially, at about 67% year over year growth for this specific sector. The customer of reverse mortgage loan is the older homeowner who are in their retirement, which recently got pummelled by around 20% and 30%. Most homeowners think they should be accessing their home equity instead of selling off their position or living off their retirement hoping that in time, it will all come back.

Even though economic crises are not new, the global depth as well as scope of the existing situation is unprecedented and has hit consumers, especially seniors, very hard. This has caused a lot of them to inquire about reverse mortgage loans.

Most of the borrowers of reverse mortgage Columbia are at the center of the crisis. Many of them are concerned about their financial health, stability, and ability to age in place. Many of them are wondering what they can do to hedge their risk during the current movements in the market and most are turning to the security and safety offered by reverse mortgages.

The inquiry levels are at levels that haven’t been seen in three years and can be considered as part of a much wider trend with more people turning to home equity to assist them in achieving a safer and more secure retirement.

One important aspect in driving this brand new consumer interest is working through the confusion by a lot of people about how the product works. Even though reverse mortgages have existed for several years, many consumers remain uncertain about the loan’s design.

There are still many misperceptions regarding reverse mortgage. One of the most common questions is how does it work. Aside from noticing a surge of inquiries from senior homeowners, more financial advisors are also asking questions and wanting to be educated about how reverse mortgage loan works so they could recommend it to their clients as an alternative to selling off their position.

The new push for educating consumers include making clarifications about the servicing difficulties in the conventional mortgage space, which is being buried in waves of forbearances. But many of today’s potential reverse mortgage borrower has already performed some form of homework in advance for any kind of lender conversation.

Call David Stacey, Reverse Mortgage Specialist, if you need to know more about reverse mortgage.

David Stacey
Reverse Mortgage Specialist
Columbia, SC 29205
(803) 592-6010
http://reversemortgagecolumbiasc.com/

Reverse Mortgages: The What, The Who And The How

There are different types of home loans on the market. One of which is what we call reverse mortgage. Some people might think that this is similar to a traditional mortgage or home loan. The only similarity is that both are loans against a borrower’s home. To understand this type of loan further, let us first discuss what a reverse mortgage really is.

What is a Reverse Mortgage Loan?

A reverse mortgage borrower does not need to pay back the lending company as long as he/she still lives at the residence used as collateral. The loan amount will be based upon the home’s equity and the age of the borrower. A borrower has the options to receive the funds in different terms – monthly payments, a lump sum, a line of credit, or a combination of these methods. You must take note that in reverse mortgage, you are not required to pay the loan back unless you sell your home, move out or die. One of the many advantages of having this kind of loan is that you can use the loan money without having to move out, rent or repay the loan each month.

Who can Apply?

You or your spouse are at least 62 and are co-owners of the residence.

You must own a home (this home should also be your primary residence).

One of the good things about a reverse mortgage in Columbia is that you don’t need to have an income to qualify (however, you do need to demonstrate that you have the resources to pay the homeowners insurance and real estate taxes). Your home must meet the U.S. Department of Housing and UrbanDevelopment (HUD) standards to qualify. If you own a mobile home or cooperative house, you can’t apply for this kind of loan. Only single-family home, a one-unit to four-unit dwelling, a condominium unit or some other HUD-recognized dwelling unit are the only types of homes accepted.

How to Apply?

Shop and Compare. You can use the internet to look for loan companies and compare their rates and fees. It is always a wise move to shop around so you can weigh your possible options. You can also ask people you know like your family members, friends, relatives and co-workers what they know about this type of loan or read reviews. However, weigh their opinions against what is best for you. There are a lot of misconceptions about reverse mortgages and taking someone’s advice that is hot knowledgeable can hurt you. Choosing a legitimate and reliable lending institution can be a difficult task though, since a lot of scams have evolved in the market. Contact Reverse Mortgage Specialist and schedule a time to get all your questions answered.

After you have chosen a local lending institution, you can now fill out and submit the reverse mortgage application form. Be sure to have the necessary documents such as your credit report, proof of your identity, etc. Requirements may vary depending on your chosen lender.

You might need to present a property appraisal.

Once approved, make sure that you have read and understood everything before finally signing any contract or document.

Meeting with a qualified counselor like David Stacey is your best bet for making sure you are doing what is right for you and your future. Call Reverse Mortgage Specialist today to schedule a convenient time to meet.

David Stacey
Reverse Mortgage Specialist
Columbia, SC 29205
(803) 592-6010
http://reversemortgagecolumbiasc.com/

Using Reverse Mortgage To Pay For Long Term Care

When it comes to long term care insurance, seniors have the option to use a reverse mortgage and other options to cover their long-term care expenses. Since long term insurance will ask you to be in excellent health, this isn’t always available to everybody especially for people who are older whose premiums tend to be prohibitive. In case you are at least 62 years old and you own your home, you can obtain a reverse mortgage to cover your care at home costs or your long term care expenses, which insurance policies don’t usually pay for.

A reverse mortgage loan allows you to borrow from the amount that you’ve already paid for your home. You are tapping into cash that’s otherwise made available to you only if you decide to sell your home. The remaining balance of the home equity will be given to your estate.

You can choose to receive monthly payments, as a line of credit, or lump sum. Plus, the proceeds that you receive are tax-free. Although the age of eligibility is 62 years old, it is ideal to wait until you are on your early 70s. If the borrower is much older, he or she will have higher chances of getting a bigger loan.

The federal government has also set some maximum limits regarding the amount of equity that could be borrowed. Generally speaking, just about 50% of the home’s value is made available through reverse mortgage.

You can use the money you get from the reverse mortgage Columbia loan to cover your home health care expenses. Since you should repay the loan once you decide to sell the house, the long term care in another facility cannot be paid for using the reverse equity mortgage unless the property’s co-owner qualifies to continue using the house as his or her primary residence.

Reverse Mortgage and Long Term Care Expenses

A study conducted by The National Council on the Aging (NCOA) revealed that using reverse mortgages to cover long term care expenses at home can help address what continues to be a real problem for most older Americans as well as their families.

The country spent $123 billion in 2000 for the long term care of those who are above 65 years old, with the amount poised to double over the next three decades. Almost half of those costs are covered out of pocket by people and just 3% are paid for the insurance companies while the health programs of the government cover the rest.

The study also showed that out of the 13.2 million reverse mortgage loan candidates, about 5.2 million are either receiving Medicaid or may need Medicaid in case they had to deal with covering the expensive cost of long term care in their homes. This segment of the older population of the country is economically vulnerable may get $309 billion in total from reverse mortgages that could help cover their long term care.

Call Reverse Mortgage Specialists if you want to know if taking out a reverse mortgage is the most suitable option for you.

David Stacey
Reverse Mortgage Specialist
Columbia, SC 29205
(803) 592-6010
http://reversemortgagecolumbiasc.com/

Who Will Own Your Home After Getting A Reverse Mortgage?

Many people think that getting a reverse mortgage loan means they are selling their houses to a lender for a lower value and that the lender will stand to benefit once the value of your home increases in the future.

If you get a reverse mortgage, just like when you obtain a traditional loan, the lender will take a security interest in your home’s value for the outstanding balance that you carry out.

With a traditional mortgage, you will own the house even though you owe a big amount of cash at the outset of your loan. You just pay off the amount of the loan over time until you have paid it off completely.

With reverse mortgage loans, you continue to own the house but you will owe a smaller loan amount at the start of the loan and the amount that you owe will grow until your death or once you have decided to move out of the house for good. You build up interest on the reverse mortgage loan so you owe much more than once the time comes that you have to repay the loan, which is usually done by selling the house.

Get The Benefits Of Selling Your Home

There is a misconception that with a reverse mortgage, the bank owns the house. That is not true. Although it may seem like you are selling your home to a lender. But the truth is, you are only selling them a part of your house.

The reverse mortgage will pay off your existing loan. You will have access to the equity of the house now so you could live the way you want, without the responsibility of paying repayments every month.

When you purchase a new house, you usually put down between 5%-20% of the purchase price, so it is like the bank is purchasing most of your house, but letting you live in it while you pay them back what you owe with interest.

This is a lot like reverse mortgage. If you have home equity remaining in your house at the end of the day when your home sells, it will still belong to you as the borrower or to your estates.

You Own The House

You might be thinking that a reverse mortgage Columbia may prevent you from repainting your home, renovating, renting out a room, or having a family member move in.

Once again, that is not true. A regular reverse mortgage will not restrict you from doing any of these things. With a reverse mortgage, you are the legal owner of the house and your name will remain on the title.

There are some restrictions on certain things like renting out the house while you are not living in it. It is because this kind of loan was created to allow retirees to age in place and that is why you should stay in the house and use it as your primary residence.

Call Reverse Mortgage Specialist if you want to know if this type of loan is the best option for you. 

David Stacey
Reverse Mortgage Specialist
Columbia, SC 29205
(803) 592-6010
http://reversemortgagecolumbiasc.com/