Money is tight for most people with the way that the economy is today, and this can be especially true for seniors. Social security doesn’t tend to be enough to get by and when there are so many bills to pay for such as medical bills and a family to provide for, there isn’t any money left over to enjoy retirement. Things can be especially tough when there is still a mortgage to pay because the interest rates and monthly payments just seem to get higher and higher. Fortunately there is a way for seniors to increase the amount of money they receive monthly and even pay off their mortgage without having to leave behind large debts for their children.

Reverse mortgages have been around since the 1980’s and have come a long way since the first one. They are now supervised by the government and there are laws that lenders and borrowers have to follow in order to complete the reverse mortgage transaction. The way that a reverse mortgage works is different than any other kind of loan because instead of needing money to purchase an item, the person has an item and needs money. In this case, the item would be the home that a person lives in.

A person must be over the age of 62 to qualify for a reverse mortgage. The older the borrower is, the more money they will get from their reverse mortgage.

Some home may not qualify for the reverse mortgage, and other types of homes such as mobile homes have to meet certain restrictions in order to be considered. Any borrower who chooses to get a reverse mortgage must go through counseling to be sure that they understand the loan and that they can afford the fees that go along with it.

Once a senior has been approved for the loan, they can do whatever they want with their money. The most common option is receiving their cash flow in monthly payments that will continue for as long as the borrower is alive, no matter how long they live. Since the borrower is taking out money against the house, when they no longer are no longer in the home, the estate will sell the home to repay the loan, or the family can choose to refinance. If the sale of the house doesn’t make enough money to cover the loan, the borrower doesn’t have to make up the difference, because all reverse mortgages are insured by the federal government.

For questions or more information regarding a Reverse Mortgage, visit an expert at www.reversemortgagenation.com!

December 1,  2010 , Baltimore, MD.

Sue Haviland, CSA, Author and Reverse Mortgage Expert, announces the release of her new book “Priceless Caregiving: Stories of Elder Care Success, Courage and Strength.” Sue is a contributing author in one of the most uplifting books to be written all year.  Now released in paperback, Priceless Caregiving can be ordered through Amazon.com or by contacting her office locally.

“I am so proud to have contributed to such a positive and insightful piece of literature that will help so many baby-boomers, seniors, and adult children of aging parents who are struggling with questions and concerns about an aging loved one.”, states Haviland.

The stories are true, heartwarming, and life-changing…. showing how elder care services of all kinds have impacted the lives of senior clients and families.

“Priceless Caregiving” will take you on an emotional journey that gives you inspiration and hope. The stories themselves specifically show how elder care has saved seniors’ families from stress, worry, and sleepless nights. The stories also teach all of us the importance of helping our aging loved ones maintain independence and choice for life. Readers will be amazed at how caregivers have not only changed the lives of seniors, but also their family members.

This insightful and inspirational book dispels the common myths and misconceptions associated with elder care services. The real-life stories within will help the reader discover how positive and motivating having a team of caregivers and a support system can be for the entire family. Priceless Caregiving reinforces how important it is to choose a reputable elder care service that cares about their clients like family, and provides information to help you make the right decisions for you and your aging loved ones.

The book was compiled by Valerie VanBooven RN BSN who adds, “We owe great thanks and tribute to the tireless caregivers who wrote this book. Each contribution is from a real life hero for our senior population.“

For more information contact Sue Haviland at 410-557-0294 or visit www.reversemortgagenation.com.

The History of Reverse Mortgages and Why They Are So Popular Today in Baltimore, MD

Reverse mortgages have been around since 1961. The first person to receive a reverse mortgage was Nellie Young through the Deering Savings and Loan Bank of Maine. At that time, the reverse mortgage was issued through the bank itself and any bank could choose whether or not they would do a reverse mortgage. Not a lot of people took advantage of reverse mortgages because there was nothing to guarantee that a bank wouldn’t take advantage of them. Banks also found some risk in doing reverse mortgages because there was nothing to guarantee that the borrowers fully understood what they were doing when taking out this reverse mortgage. The whole system still had a few issues to be worked out.

In 1988 the federal government stepped in and worked out a new law with the AARP to help increase the use of reverse mortgages under government supervision. The law was the Federal Housing Authority Insurance Program where 50 different lenders were chosen across the country to participate in giving out reverse mortgages. It wasn’t until 1989 that the first government supervised reverse mortgage was given out.

As people learned about reverse mortgages, they became more popular. In 1998 the pilot program became an official program that all lenders could participate in. The reason reverse mortgages became so popular is because they allow senior citizens who own a home and have retired to access the equity of their home without any real risks to them. When they are no longer living in the home for whatever reason, the house is then either sold or the family can choose to refinance the mortgage. If the house doesn’t sell for the amount that the reverse mortgage was for, there is no obligation to pay back the difference.

The way that an elder receives their money is completely up to them. They can get a line of credit where they can use the money from the bank as needed. This method will give them the most amount of money for their home. They can also take out the reverse mortgage as a lump sum, although the interest fees they will have to pay on it will be higher than the other options. The most common method of receiving payment from a reverse mortgage is to get a monthly payment. This payment will continue for as long as the person is alive, no matter how long they live or what the amount of the loan was.

There are a few stipulations to receiving a reverse mortgage, although for most people they aren’t a problem. The minimum age a person must be to get a reverse mortgage on their home is 62. They also must not have a current mortgage on the house or they will have to use a portion of their reverse mortgage to pay off the first mortgage. They will also have to go to financial counseling to assure the lender that they are fully aware of what the terms of the loan are and that they can meet their financial responsibility.

For questions or more information regarding Reverse Mortgages, please visit here

By Dennis Estrada

Using reverse mortgage, any sixty-two years old or over can convert the home equity into cash. The mortgage lenders give the cash by lump sum payment, several payments, credit line, or combination. Here are the common advantages of reverse mortgage.

Read more HERE.

WASHINGTON – A study released by The National Council on the Aging (NCOA) shows that reverse mortgages can be used by over 13 million Americans to pay for long-term care expenses at home, allowing many to remain independent and in their homes longer.

“The study shows that reverse mortgages have significant potential to help many seniors pay for help at home or to make home modifications. It also points to the need for strong consumer safeguards and lower transaction costs if these loans are to appeal to the millions of older Americans who could potentially benefit,” said NCOA president and CEO James Firman.

According to the study, there are some 9.8 million elder households (aged 62 and older) that are dealing with an impairment that can make it hard to live at home. In total, these households could access as much as $695 billion through reverse mortgages. For individuals, the extra cash could go a long way to help with family caregiving and other long-term care expenses. For example, a borrower aged 75 years old with a home worth $100,000 could receive a reverse mortgage loan that could pay them $500 a month for almost 12 years.

“This is an important study that, for the first time, shows that elderly homeowners, many with chronic conditions, can use reverse mortgages to pay for care at home,” said Jim Knickman, vice president for Research at the Robert Wood Johnson Foundation. “We hope that these findings will prompt new thinking into how the nation addresses the challenge of financing long-term care.”

Reverse mortgages are loans that allow homeowners aged 62 and over to convert home equity into cash while living at home for as long as they want. Borrowers continue to own their homes, and do not need to make any monthly payments. Instead, they can choose to receive the funds as a lump sum, line of credit, or as monthly payments (for up to life). The loan comes due only when the last borrower moves out, dies or sells the home.

The “Use Your Home to Stay at Home: Expanding the Use of Reverse Mortgages to Pay for Long Term Care” report, funded by the Centers for Medicare and Medicaid Services and the Robert Wood Johnson Foundation, also shows how reverse mortgages can alleviate financial pressure not only for individuals and families, but also for state Medicaid programs and the federal government. Increasing the market for reverse mortgages could save Medicaid $3.3 billion (with a four percent take up rate) annually by 2010.

“Many seniors and their families can benefit from effective ways to pay for the long term care services they need, in the setting they prefer,” said Dr. Mark McClellan, administrator of the Centers for Medicare & Medicaid Services. “NCOA’s report shows that reverse mortgages can provide real help in financing long term care needs.”

However, there are several obstacles to their growth for this purpose. For example, the NCOA study shows that while two-thirds (67 percent) of older homeowners today have heard of a reverse mortgage, only 9 percent indicate that they are likely to use this financing option to pay for assistance at home. Many worry that they risk impoverishment, or won’t be able to leave a legacy to their children if they tap home equity. The cost of these loans, and current Medicaid policies on how reverse mortgages affect eligibility for long-term care benefits, also appear to be barriers.

“We need expanded public education, and additional work to explore how to reduce the cost of tapping home equity, to strengthen consumer protections, and promote innovation,” said Barbara Stucki, PhD, project manager for NCOA’s Use Your Home to Stay at Home project. “Overcoming these obstacles will mean that reverse mortgages can play an important role in helping many older Americans pay for the supportive services they need to continue to live at home safely and comfortably.”

According to Firman, NCOA will continue to play a leadership role in promoting the appropriate use of reverse mortgages to help pay for long term care at home.

Founded in 1950, The National Council on the Aging is a national network of organizations and individuals dedicated to improving the health and independence of older persons; and increasing their continuing contributions to communities, society, and future generations.; For more information on NCOA, visit www.ncoa.org.

A PowerPoint presentation further explains findings from the report.

The report is also available online.

Background

Reverse Mortgages for Long-Term Care
“Use Your Home to Stay at Home”™

Started in September 2003 by The National Council on the Aging (NCOA), the “Use Your Home to Stay at Home” project has developed a national blueprint for encouraging the use of reverse mortgages to help older Americans pay for long-term care services at home. Reverse mortgages are a special type of loan that allows people age 62 and older to convert equity in their home into cash while they continue to live at home for as long as they want.

Long-Term Care Costs and Home Equity

Currently, the costs of long-term care are primarily paid out of pocket by consumers or by Medicaid, the federal/state program designed to pay costs of health care for low-income individuals. In 2000, our nation spent $135 billion a year on long-term care for those age 65 and older, with the amount likely to double in next 30 years. Most of those dollars pay for care in skilled nursing facilities.

Recent studies show that older Americans, including those who have serious health problems and need long-term care, want to live at home rather than in an institution. Most elders (82 percent of those age 62 and older) own their homes and 74 percent of those own them free and clear. With over $2 trillion tied up in home equity, this financial resource has the potential to dramatically increase the ability of seniors to pay for long-term care at home. Reverse mortgages can free up needed cash while enabling seniors to continue to own their home.

Of the nearly 28 million American households age 62 and older, NCOA has found that almost half (48 percent), or about 13.2 million, are good candidates for a reverse mortgage. The amount that these older households could receive from a reverse mortgage is substantial  – on average $72,128. These funds can go a long way to pay for help at home and for retrofitting the home to make it safer and more comfortable. For some, they could be used to purchase long-term care insurance if they qualify. In total, an estimated $953 billion could be available from reverse mortgages for immediate long-term care needs and to promote aging in place.

For many older families, home equity is their single, biggest financial asset. Unlocking these substantial resources can help empower “house rich, cash poor” seniors by giving them additional resources to purchase the services they feel best suit their needs. The use of private funds from reverse mortgages can also strengthen community long-term care programs and reduce the burden on state Medicaid budgets.

Funders

The “Use Your Home to Stay at Home”™ project is funded by the Centers for Medicare and Medicaid Services, the federal agency that operates Medicare and Medicaid, and the Robert Wood Johnson Foundation.

Program Management

James P. Firman, Ed. D., NCOA president and CEO
Jay Greenberg, Sc.D, executive vice president
Barbara Stucki, Ph.D., project manager

Headquarters

The National Council on the Aging
300 D Street SW Suite 801
Washington, DC  20024
(202) 479-1200
(202) 479-0735

About NCOA

Founded in 1950, The National Council on the Aging is a national voluntary network of organizations and individuals dedicated to improving the health and independence of older persons; increasing their continuing contributions to communities, society, and future generations. NCOA is a national voice and powerful advocate for public policies, societal attitudes, and business practices that promote vital aging.  NCOA is an innovator, developing new knowledge, testing creative ideas, and translating research into effective programs and services that help community service organizations serve seniors in hundreds of communities. And, NCOA is an activator, turning creative ideas into programs and services that help community services organizations serve seniors in hundreds of communities. For more information on NCOA, visit www.ncoa.org.

Visit me at www.reversemortgagenation.com/suehaviland if you have questions or need help with a reverse mortgage in the Baltimore MD area.

Reverse mortgages shouldn’t be lumped into ‘bad’ category

“Comparing every loan’s shortcoming – real or perceived – to a “subprime” product needs to stop.”

Continue reading HERE.

If you are considering a Reverse Mortgage in Baltimore, Maryland this is important information to have!  Visit me at www.reversemortgagenation.com/suehaviland if you have any questions, or need help with a reverse mortgage in the area.

Continue reading HERE.

1. What is a reverse mortgage?

A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that built up over years of home mortgage payments can be paid to you. But unlike a traditional home equity loan or second mortgage, no repayment is required until the borrower(s) no longer use the home as their principal residence. FHA’s HECM provides these benefits. You can also use a HECM to purchase a primary residence if you are able to use cash on hand to pay the difference between the HECM proceeds and the sales price plus closing costs for the property you are purchasing.

2. Can I qualify for FHA’s HECM reverse mortgage?

To be eligible for a FHA HECM, the FHA requires that you be a homeowner 62 years of age or older, own your home outright, or have a low mortgage balance that can be paid off at closing with proceeds from the reverse loan, and you must live in the home. You are further required to receive consumer information from an approved HECM counselor prior to obtaining the loan. You can contact the Housing Counseling Clearinghouse on (800) 569-4287 for the name and telephone number of a HUD-approved counseling agency and a list of FHA-approved lenders within your area.

3. Can I apply if I didn’t buy my present house with FHA mortgage insurance?

Yes. It doesn’t matter if you didn’t buy it with an FHA-insured mortgage. Your new FHA HECM will be FHA-insured.

4. What types of homes are eligible?

To be eligible for the FHA HECM, your home must be a single family home or a 1-4 unit home with one unit occupied by the borrower. HUD-approved condominiums and manufactured homes that meet FHA requirements are also eligible.

5. What’s the difference between a reverse mortgage and a bank home equity loan?

With a traditional second mortgage, or a home equity line of credit, you must have sufficient income versus debt ratio to qualify for the loan, and you are required to make monthly mortgage payments. The reverse mortgage is different in that it pays you, and is available regardless of your current income. The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home or FHA’s mortgage limits for your area, whichever is less. Generally, the more valuable your home is, the older you are, the lower the interest, the more you can borrow.

You don’t make payments, because the loan is not due as long as the house is your principal residence. Like all homeowners, you still are required to pay your real estate taxes, insurance and other conventional payments like utilities. With an FHA HECM you cannot be foreclosed or forced to vacate your house because you “missed your mortgage payment.”

6. Can the lender take my home away if I outlive the loan?

No. You do not need to repay the loan as long as you or one of the borrowers continues to live in the house and keeps the taxes and insurance current. You can never owe more than the value of your home at the time you or your heirs sell the home.

7. Will I still have an estate that I can leave to my heirs?

When you sell your home, you or your estate will repay the cash you received from the reverse mortgage plus interest and other fees, to the lender. The remaining equity in your home, if any, belongs to you or to your heirs.

8. How much money can I get from my home?

The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home or FHA’s mortgage limits for your area, whichever is less. Generally, the more valuable your home is, the older you are, the lower the interest, the more you can borrow. You can use an online calculator like the one on the AARP website to get an idea of what you may be able to borrow.

9. Should I use an estate planning service to find a reverse mortgage?

FHA does NOT recommend using any service that charges a fee for referring a borrower to an FHA lender. FHA provides this information free, and HUD-approved housing counseling agencies are available for free or at very low cost, to provide information, counseling, and a free referral to a list of FHA-approved lenders. Search online or call (800) 569-4287 toll-free, for the name and location of a HUD-approved housing counseling agency near you.

10. How do I receive my payments?

You have five options:

• Tenure – equal monthly payments as long as at least one borrower lives and continues to occupy the property as a principal residence.
• Term – equal monthly payments for a fixed period of months selected.
• Line of Credit – unscheduled payments or installments, at times and in amounts of your choosing until the line of credit is exhausted.
• Modified Tenure – combination of line of credit with monthly payments for as long as you remain in the home.
• Modified Term – combination of line of credit plus monthly payments for a fixed period of months selected by the borrower.

I started out way back in 1981 working for a bank doing car loans and then progressed to taking mortgage loan applications. I guess I did pretty well because I was then asked to start processing these loans. Eventually I was promoted to working exclusively with the builder division. I guess you could say that I really started at the bottom and worked my way up.

Back in 1993 I went to work for Brian Sacks of LoanOfficerSuccess.com as his personal loan processor. Wow!, talk about literally jumping from the kettle into the fire. This experience totally changed my life. Brian was very demanding but he also showed me a system that worked for quickly getting loans out the door and closed with the least amount of hassle for everyone involved.

The years went on and I continued to learn from Brian and eventually he allowed me to start originating as well. We had actually become a team but I wanted more. Once I started originating I sort of caught the fever and really enjoyed it much more than processing.

I have originated over 327 reverse mortgages within the last five years and still originate today in the Baltimore area.