Are Reverse Mortgages Too Risky

Are Reverse Mortgages Too Risky

The Risks and Rewards of Reverse Mortgages

Retirees need sufficient income to get them through their golden years. If your home is your largest asset, though, what do you do?

The FHA started the reverse mortgage program for seniors just like you. Unlike a traditional mortgage with required monthly payments, the reverse mortgage pays homeowners age 62 and older some of their home’s equity. You may choose from a lump sum payment, monthly payments, a line of credit, or a combination.

In the last few years, the media ran wild with horror stories of scam artists taking advantage of seniors with reverse mortgages, but they’ve come a long way. Today, the reverse mortgage program offers seniors access to their funds without selling their home.

Like any other mortgage or loan, the reverse mortgage has its risks and rewards. Check them out below. View full post…

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Tempting Interest Only Mortgage

Tempting Interest Only Mortgage

The Good, Bad, and Ugly of an Interest Only Mortgage

An interest only mortgage can appear to be a very attractive offer at the onset. However, it can also be a disaster waiting to happen for many borrowers who don’t completely understand what awaits them five or ten years down the road.

About ten or twelve years ago, a period known as the Great Recession caused havoc for many homeowners. One of the causes of this economic ruin was interest only mortgages held by borrowers who bought expensive homes they couldn’t afford. When the interest-only period ended and they had to begin repayment of principal also, and a higher rate of interest, they defaulted. have brought this option back for certain home buyers. The question we have is, should a home buyer View full post…

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Get A VA Mortgage Easy

Get A VA Mortgage Easy

What You Need to Know to Get a VA Mortgage

If you’re a military veteran, you’ll be glad to know that the Department of Veterans Affairs has a program to help you buy a home. This program, known as VA loans, makes it much easier for a veteran to get a VA mortgage through a private lender. The VA does not make loans directly and instead, guarantees home loans for veterans.

One advantage of a VA loan is that a down payment isn’t always necessary. Other advantages are that mortgage insurance is not required, plus there is no VA requirement of a minimum credit score.

VA loans are available to active duty military personnel and also military veterans, who generally find that they can qualify for a VA loan easier than a conventional mortgage, especially View full post…

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Why a Mortgage Preapproval

Why a Mortgage Preapproval

Why Should I Get a Mortgage Preapproval Letter?

What is a mortgage preapproval and why would I want to get one? Short of a formal loan commitment, there are two types of letters that a lender will issue to help a house hunter in the purchase of a home.

A prequalification letter is one that is issued by a lender after reviewing certain financial information submitted by the buyer. This letter is rather broad and gives an estimate of the amount of a mortgage that the buyer may qualify for.

A preapproval letter is one that is issued by a lender after reviewing and verifying all of the financial documents that are required View full post…

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Is a Mortgage Refinance the Best Option

Is a Mortgage Refinance the Best Option

How To Know If a Mortgage Refinance Is Your Best Option?

When interest rates are low, applications for a mortgage refinance are a major portion of the total of all mortgage applications. This is due because when mortgage interest rates fall, many borrowers see an opportunity to restructure their debt hoping to get a more favorable rate or term.

Simply having a drop in mortgage interest rates doesn’t mean that its the right thing to do for everyone. We all have different situations and lifestyles and everyone doesn’t fit into the “average” cookie cutter mold. Because of this, the following 9 points may help you if you are considering refinancing your mortgage.

  • The equity in your home

    Equity is one of the first items that a refinance lender will look at. If it’s not there within the banks’ guidelines, most conventional lenders will decline your request. During the last recession, many homeowners were underwater, some very deep.

    The value of homes has been rising as of late and the number of underwater loans has dropped. This varies from state to state and is determined by a number of factors. If your home has little equity, a conventional lender probably View full post…

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How Does Reverse Mortgages Program Work

How Does Reverse Mortgages Program Work

How Does Reverse Mortgages Program Work? – The Ultimate Guide

If you’re getting near retirement age you may have come across this financial product. Just about everyone asks the same question, just how do reverse mortgages program work? They continue to grow in popularity and the basics are relatively simple.

A reverse mortgage is designed for senior adults getting near retirement or already retired. Its similar to a conventional mortgage in one respect – it allows you to borrow against the equity that you have in your personal residence.

However, unlike a traditional mortgage where you are required to make monthly payments of principal and interest to repay the loan, with a reverse mortgage, you don’t. As long as you live in the home, none of the mortgages has to be repaid. Not until you sell the home, or it is no longer your personal residence, or the last borrower dies, is the loan repaid.

This program is administered by the FHA and does have certain conditions that must be met.

From a financial perspective, how does reverse mortgages program work?

A reverse mortgage does differ from a conventional mortgage or a home equity loan. The latter two View full post…

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Effective Shopping for a Mortgage

Effective Shopping for a Mortgage

5 questions to ask when shopping for a mortgage

(BPT) – Buying a home is a major financial commitment. It’s exciting, but can also be confusing and overwhelming. Choosing the best mortgage that fits your needs is an important first step and first-time home buyers in particular should research the many options and know the right questions to ask. Here are some questions to ask a lender when shopping for a mortgage that will help you make an informed mortgage decision:

* How much can I afford? A home affordability calculator can help you get an idea of what you may be able to afford and keep your monthly payments within your budget. In addition to recurring expenses like car payments, student loans, credit cards and disposable income, be sure to consider other monthly expenses related to the new home, like association fees, homeowners’ insurance, utilities and property taxes. Further, some types of mortgages have firm eligibility cutoffs related to the ratio between a buyer’s total debt amounts and their monthly income.

* How much do I need for a down payment? It’s a common misconception that a View full post…

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Home Mortgage Loan Protection

Home Mortgage Loan Protection

How You Can Protect Yourself Financially on a Home Mortgage Loan

Many years ago, when looking for a home mortgage, it wasn’t a difficult task. You found the home that you liked, your realtor sent you into the bank or savings and loan association that they used, and you completed the application.

A few weeks later, the lender contacted you saying you were approved and quoted you their loan terms. This too was rather cut and dry – loan amount, interest rate, monthly payment, and the number of years. A settlement was done about a month later, and that was it.

Fast forward many years to today’s market. Wow, what a change. Instead of a small number of mortgage lenders, now there are thousands – some good and some not so good. Some of the terminology used today almost requires the borrower to be a finance person or one having a legal background.

When shopping for a home mortgage today, you must protect View full post…

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Refinance With Bad Credit

Refinance With Bad Credit

Can You Refinance with Bad Credit

There are a few programs available, such as the Federal Housing Authority (FHA) and the Home Affordable Refinance Program (HARP) that have options for individuals with bad credit. These programs are not based on your credit score, and they don’t even require a credit check. Yes, you can refinance with bad credit.

Another organization, the U.S Department of Veterans Affairs (VA), offers mortgage refinancing to individuals who have bad credit. These are done through various lenders who determine their own requirements, and will vary by the lender.

Some of the statistics from August 2017 bear this out. Ellie Mae View full post…

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Mortgage Debt & Silent Generation

Secrets of the Silent Generation on Mortgage Debt

Mortgage debt is climbingSince the last financial crisis, many lower income American citizens have seen their mortgage debt levels rising. This has hit those nearing or in retirement the hardest, and is one of the primary obstacles that would otherwise have provided adequate retirement funding. Actually, debt has increased substantially since the 1990’s for many individuals because wages have struggled to keep up.

As an example, in 2007, those lower income individuals carried mortgage debt for their households that was approximately twenty percent (20%) of their total income. Six years later, in 2013, that percentage had jumped to fifty percent (50%) of total income.

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