Friday November 30th, 2007 Reverse Mortgages, Are they right for you? Congressman Campbell: Expanding American Homeownership Act of 2007 Dan Mooney from HUD: Why Seniors are required to go through Counseling Sessions Questions You Should ASK
CCA 2007 Board of Directors Jeanne Allen Isabel Muennichow Bob Bouer Roz Rhodes Judy DiLallo Dick Robechek Joseph Jagoda Jim Shaffer Nancy King Jerry Sheinblum Jo Ann Leuck Erwin Stuller Maxine McIntosh Joan Taft Charles McLaughlin Pat Whitson Denise Welch Join CCA Today to keep these programs coming to you! Mail your $10.00 check to Telephone Numbers to Remember Laguna Woods Village Numbers City Hall 639-0500 Insurance 597-4202 Office on Aging 800-510-2020 Library 597-4274 OCTA 714-636-RIDE LW Globe 837-5200 OC Health & Human Services 211 Permit Office 597-4616 Fire/Paramedic 911 Property Service 597-4600 Laguna Woods Village Numbers Recreation 597-4227 Bus Information Security 580-1400 Bus, Lift 597-4679 Social Service 597-4267 General Info 597-4369 Stables 597-4275
What Is a Reverse Mortgage? It s a home loan that enables you to convert a portion of your home equity into tax-free 1 funds without having to sell your home, give up title, or take on a new monthly payment. All co-owners must be at least 62 years old. There are no income, employment, medical or credit score qualifying restrictions. 2 There are no monthly payments to make. You do not have to repay the loan for as long as your home remains your primary residence. 1 Consult a tax advisor 2 Reverse Mortgage borrowers are required to obtain an eligibility certificate by receiving counseling sessions with a HUD-approved agency. Family members are also strongly encouraged to participate in these informative sessions. Why would anyone want a Reverse Mortgage? It s Not the Money. It s What the Money Will Buy: Stay in their home Debt reduction Eliminate the monthly financial struggle Medical needs Fund long term care Fix up the house Leave financial structures intact Accelerate inheritance to heirs (help pay grandkids college tuitions and down payment of their first house) Second home Travel Play
What are the advantages of a Reverse Mortgage? Security You retain title and ownership of your home. No repayment required as long as your live in your home as your primary residence and all other program requirements are met. Flexibility Obtain your loan proceeds in a lump sum, in monthly installments, as a line of credit, or any combination of the three. Choice You can change payment plans as many times as you wish. Peace of Mind Enjoy a more comfortable retirement in your own home. Mortgage insurance ensures that you will never owe more than the value of your home. Age and Eligibility Requirements You and any co-owners must be at least 62 years old. Your home must be your primary residence. You must own your home free and clear, or Your home debt must be paid off with Reverse Mortgage proceeds. Educational counseling with a HUD-approved counselor is required. Flexible Payment Options You can obtain your Reverse Mortgage proceeds: In a lump sum payment to cover large expenses In fixed monthly payments to supplement your income As a line of credit to draw on as you need it Or any combination of cash, monthly income and credit line you select (HECM only) You can receive an immediate cash advance in addition to monthly payments. You can change payment plans as many times as you wish until your funds are exhausted.
Reverse Mortgage Repayment No mortgage payments are required throughout the life of your Reverse Mortgage loan. The loan may be repaid at anytime either in whole or in part and without penalty. Partial repayment can be used to increase your monthly income payments. The outstanding loan balance becomes due when you sell or no longer occupy your home as your primary residence. Frequently Asked Questions Can I be forced to sell my home if the money I owe on the loan exceeds the value of my home? Absolutely not, as long you continue to occupy the home as your primary residence, pay the appropriate taxes and insurance, and maintain upkeep of your home. When must the loan be repaid? Your loan balance the total of all payments made to you, plus accrued interest and fees becomes due when you no longer occupy the home as your primary residence. After a grace period, your estate may repay the loan by selling the home or by paying off the balance due and keeping the home. Will receiving my Reverse Mortgage proceeds in monthly payments affect my Social Security, Medicare supplemental security income, or Medicaid benefits? If you opt to receive monthly payments, they will not affect your Social Security or Medicare benefits. However, your eligibility for need-based programs such as Medicaid or state assistance programs may be impacted. We recommend that you consult a tax or legal advisor and your local Area Agency on Aging for advice.
What if I decide to sell my home? You always retain title to your home during the period of your reverse mortgage loan. You can sell your home at anytime. The outstanding loan balance becomes due upon the sale of your home. What are CONS of a Reverse Mortgage? Typically a reverse mortgage should not be used as a short term loan. The reality of business is that a reverse mortgage is a financial product, a loan. The fees incurred to attain a reverse mortgage are the typical fees incurred to attain a mortgage. Like any mortgage, the longer a reverse mortgage is kept, the longer the time period the fees are spread. The shorter a loan is kept the more expensive it is. If a borrower plans to move from their home, we encourage them to consider not attaining a reverse mortgage unless necessary. The reverse mortgage industry is highly regulated so that there are NO padded fees. Only substantiated costs can be incurred with a reverse mortgage. Contradict personal financial style and philosophy. Older borrowers today were taught their house is their security, their rock. In many minds, taking a reverse mortgage is just too much of a paradigm shift. We find it is often the children of the borrowers that initiate, support, and encourage older borrowers to increase their quality of life with a reverse mortgage. They can be confusing to some borrowers. A reverse mortgage is a financial transaction that is a new way of thinking. Who ever thought it would make sense to take money out of their house to enhance the quality of your life? Where do I go for clarification and to ask questions? Call our local HUD office Phone: (714) 796-5577 Fax: (714) 796-1285 TTY: (714) 796-5517
Here are some questions to ask your Salesperson What are the qualifications of the person you are dealing with? 1. Are you approved by HUD? 2. Do you deal exclusively with Reverse Mortgages? 3. Are you a member of NRMLA? I have the following, how do they affect Reverse Mortgage? 1. Can I lose my home? 2. Can I get a Reverse Mortgage if I have an existing loan on my house? 3. Can I get a Reverse Mortgage If I have a living Trust? 4. Are the proceeds taxable? 5. When must the loan be repaid? 6. I have a Government program, such as Medicare, Medicaid,* etc.. How will these programs be affected by a Reverse Mortgage? *Recipients of SSI, Medicaid or Medi-Cal should consult with their legal council. 7. Do I have to keep paying my HOA assessments and upkeep my home with a Reverse Mortgage?
8. What are the costs involved in obtaining a Reverse Mortgage? 9. Are there other options to a Reverse Mortgage? 10.Do I still have to pay my property taxes, 11.Why is counseling mandatory in California before I can get a Reverse Mortgage? 12.When is a Reverse Mortgage NOT appropriate? 13.What are my Reverse Mortgage safeguards? 14.How does this affect my children? 15.When do my heirs after pay off the reverse mortgage? REMEMBER: If you do not feel comfortable about STOP AND WALK ANYTHING AWAY. Reverse Mortgages are not going away. They will be there another day!
Here are a few of the excellent publications that I suggest that you read. Owner Booklet Name Address Phone Fannie Mae Considering a Reverse Mortgage? Review these 5 steps to see if one is right for you. 3900 Wisconsin Avenue, NW, Washington, DC 20016 NRMLA, National Reverse Mortgage Lenders Association Consumer Guide to Reverse Mortgages 1625 Massachusetts Ave., NW, Suite 601, Washington, DC 20036-2244 Toll-Free Tel. 866.264.4466; e-mail: reversemortga ge@dworbell. com NRMLA, National Reverse Mortgage Lenders Association Using Reverse Mortgages for Health Care 1625 Massachusetts Ave., NW, Suite 601, Washington, DC 20036-2244 Toll-Free Tel. 866.264.4466; e-mail: reversemortga ge@dworbell. com NRMLA, National Reverse Mortgage Lenders Association Just the FAQs: Answers to Common Questions About Reverse Mortgages 1625 Massachusetts Ave., NW, Suite 601, Washington, DC 20036-2244 Toll-Free Tel. 866.264.4466; e-mail: reversemortga ge@dworbell. com AARP Home Made Money, A consumer's Guide to Reverse Mortgages D12894 601 E Street, NW, Washington, DC 20049 www.aarp.org (CANHR) California Advocates For Nursing Home Reform The Reverse Mortgage Trap, By Tim Millar, Cfp, 650 Harrison Street, 2nd Floor San Francisco Ca 94107 415-974- 5171
www.reverse-your-mortgage.com 949-439-7030 President of the National Aging in Place Council OC, National Association of Women Business Owners, National Reverse Mortgage Lenders Association Professional Designation Committee
Betty DeKovner Reverse Mortgage Specialist 4590 MacArthur Blvd.,Ste. 200 Newport Beach, CA 92660 949-809-2568 Phone 888-998-8668 Toll free 949-350-8868 Mobile betty.dekovner@wellsfargo.com
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Congressman John Campbell DC Address: DC Phone: 202-225-5611 California Phone: (949) 756-2244 The Honorable John Campbell United States House of Representatives 1728 Longworth House Office Building Washington, D.C. 20515-0548 Party: Republican First Elected To Office Special Election, December 5, 2005 Year of Next Election November 4, 2008 Previous Political Work Gender: Hometown: Birth: Professional Experience (including Military): California Senate and California Assembly Male Irvine On July 19, 1955 in Los Angeles Owner, automobile dealerships Certified Public Accountant Education: Organizational Memberships: Family: Faith: Masters, University of Southern California Bachelors, University of California in Los Angeles Young Presidents' Organization National Republican Legislators Association Wife, Catherine, 2 children Presbyterian
FHA Home Equity Conversion Mortgages Housing Counselor Lists FHA funds housing counseling agencies throughout the country who can give you advice on reverse mortgages. To find a counselor near you, visit the FHA Housing Counseling Agency Listings, or call: (800) 569-4287 If you want further assistance, call:1-800-call-fha, (800-225-5342 email FHA at: hud@custhelp.com or visit the FHA Resource Center to research your answers online. National HECM Counseling Network Increasing demand for HUD's HECM product by senior citizens, has put pressure on the counseling industry to meet the demand for the required counseling. To make sufficient quality Home Equity Conversion Mortgage (HECM) counseling available, HECM counselors from the below agencies are permitted to provide face-to-face and telephone counseling nationally. Please contact them to obtain HECM counseling. National Foundation for Credit Counseling (NFCC) - Money Management International (MMI) - 1-866-698-6322 1-877-908-2227 American Association of Retired Persons (AARP) - 1-800-209-8085
Reverse Mortgage Numbers to Call and ASK HUD Counseling Office (800) 225-5342 Congressman Campbell's Office (949) 756-2244 Senator Boxers DC Office (202) 224-3553 Senator Feinstein s DC Office (202) 224-3841