Reverse Mortgage Options

Transcription

1 Reverse Mrtgage Optins December 8, AM Nn 3 Hurs CE Authr / Presenter: Rseann Farrw As a result f this seminar participants will be able t: describe the sciecnmic drivers f the reverse equity mrtgage. list tp reasns why senirs chse this mrtgage prduct. explain brrwer, prperty and financial requirements. frmulate lan amunts with nline calculatr. cmpare the currently ppular HECM (Hme Equity Cnversin Mrtgage) prducts. emply the HECM prduct in the purchase f anther hme. summarize clsing csts. evaluate advantages and disadvantages.

2 Intr/Histry 1. Myths/Miscnceptins abut the Reverse Mrtgage! Miscnceptin #1: Reverse mrtgages are nly fr desperate senirs r fr the Huse Rich, Cash Pr. Miscnceptin #2: Yur hme must be debt free t qualify fr a reverse mrtgage. Miscnceptin #3: The bank wns the hme after yu get a reverse mrtgage. Miscnceptin #4: When a reverse mrtgage cmes due the bank sells the hme. 2. Sciecnmic drivers f the Reverse Equity Mrtgage The Aging Ppulatin Ppulatin Explsin in general The Ecnmy Pr Planning Others? 3. Why senirs select the REM 1) Retire existing mrtgage 2) Increase mnthly retirement incme 3) Make hme imprvements / increase value 4) New r secnd hme purchase 5) Pay prperty r schl taxes 6) Avid Freclsure 7) Eliminate debt / credit 8) Cver daily r new health care 9) Fund lng term health care 10) Pstpne Scial Security until age 70 11) Estate planning/life ins/investment funding 12) Charitable & family gifting

3 4. Requirements (HECM prduct) Brrwer: Be 62 years f age r lder Own the prperty utright r paid dwn a cnsiderable amunt Occupy the prperty as yur principal residence Nt be delinquent n any federal debt Participate in a cnsumer infrmatin sessin given by a HUD apprved HECM cunselr Prperty: The fllwing eligible prperty types must meet all FHA prperty standards and fld requirements: Single family hme r 2 4 unit hme with ne unit ccupied by the brrwer HUD apprved cndminium prject Manufactured hme that meets FHA requirements Nte: The HECM prgram s hme value limit is currently $625,500. This limit means that if the hme is wrth mre than $625,500, the lan amunt is based n a value f $625,500 rather than its actual value. Financial N traditinal incme check, PITI ratis r emplyment qualificatins Verificatin f willingness & capacity: credit, incme, assets & mnthly expenses. Timely payment f real estate taxes, hazard and fld insurance premiums are verified. Can be lump sum, mnthly installments, line f credit, upfrnt sum+ mnthly alltments Des NOT affect SS r Medicare benefits N repayment f lan as lng as yu cntinue t wn and live in hme Still allwed if life estate r trust (in many cases even an irrevcable trust) Heirs can keep hme nce reverse mrtgage is paid in full FHA HECM prduct currently ffers Fixed r ARM (mnthly adjustment) Jumb lans currently nt available.

4 5. Dem at nline REM calculatr (Natinal Reverse Mrtgage Lenders Assciatin) 6. The FHA HECM (Hme Equity Cnversin Mrtgage) prducts Adjustable Rate Fixed Rate 7. Using the HECM fr Purchase 8. Advantages / Disadvantages 9. Self Evaluatin / Actin Steps I learned / was reminded f Resurces: Natinal Reverse Mrtgage Lenders Assciatin fr inf and list f lenders in yur state fr nline calculatr FHA Insured Reverse Equity Mrtgage Prgram (Hme Equity Cnversin Mrtgage): HECM: Hme Page fr inf: Special thanks t the team at: Reverse Mrtgage Funding, especially Richard W. Thrpe, Natinal Sales Leader Distributed Retail

5 Rseann Farrw, ABR, CDEI, CIPS, CRB, CRS, e PRO, GREEN, GRI, RSPS, SRES, SRS All Rights Reserved Rseann Farrw Seminars, PO Bx 10065, Newburgh, NY 12552