Florida | Reverse | Mortgages | Fixed rates

What to do, what to do.? Ask me.

I see that one of the major concerns on most senior’s minds, is the fear of either outliving their retirement savings or just not having enough to enjoy life in the golden years. We know the issues with Social Security, and even if our finances were properly managed it looks like it will be difficult to make ends meet. The fact is that many baby boomers are living beyond their means. Debt is at an all-time high in this country. The crisis in the mortgage industry is impacting many seniors largest asset, their home and the equity, having those fears are real and justified for seniors and boomers alike.

One of the most important things we can do is manage or virtually eliminate debt, we need to save more and start building equity for the future this is very important. Why? Having such a plan can mitigate our fear about out living our money. The equity in your home can be the ticket and can make the difference.

When the time is right senior homeowners with equity, can tap into it with a reverse mortgage. They can have access to these funds with a lump sum, a credit line, or monthly income and there will be no burden of making mortgage payments. The money derived from the reverse mortgage along with social security, perhaps some personal investments and savings can ensure the quality of life that the boomers have been accustomed to most of their lives.

With a reverse mortgage, the debt can never exceed the value of your home, so none of the debt will pass on to heirs. Heirs will inherit the remaining equity in the home. But the amount of equity is diminished by the debt.

Those who have experience the Great Depression feel there primary asset was their home and that the home was something that needed to be passed on to the next generation.

I don't necessarily feel that way in the case of the future generations. They will be using the equity to travel or to meet their own personal needs rather than pass it on to the children.

There's no reason not to pursue your dreams, life is too short. If you're a homeowner 62 or older, a reverse mortgage may help you do some of the things that you have always dreamed about...

info@myfloridareverse.com

The reverse mortgages is a great choice for many seniors to enhance their lives.

The reverse mortgage was designed for seniors age 62 and older to release some of the equity in their homes it differs from the standard equity line in that there are never any payments required with the reverse mortgage while the senior lives in the home. The formula that FHA uses includes the property value, the age of the youngest individual on deed (62 or older) and the current interest-rate based on the constant maturity index CMT Treasury Bill or the LIBOR index.

Example: a 62-year-old with a $200,000 home and today's interest-rate could receive a little over $100,000 out of the equity. This amount is after closing costs and all other fees have been handled. The net available to the senior can be taken in a lump sum, a monthly payment for the rest of his/her life of approximately $570 or a credit line to be used as needed. The credit line has a growth rate attached to it, and the money does not draw interest until it is used. The credit line is probably the most used of the features that are available with the reverse mortgage.

Seniors interested in learning more about a reverse mortgage will often use a reverse mortgage calculator. The reverse mortgage calculators you find online require the estimated current value of the home, the total amount of liens (if any) on the property, the ages of individuals on the deed and the ZIP code. The reverse mortgage calculator requests the ZIP code because each county in each state may have a different maximum loan limit set by FHA.

The reverse mortgage calculator will give a value that is fairly close to what an actual reverse mortgage estimate will show. This is a great way to get an idea of how much you could receive from a reverse mortgage, but remember it is just an estimate, most reverse mortgage products use variable interest rates and some reverse mortgage calculators do not always stay completely accurate or current with the interest rates. There are also some reverse mortgage calculators that will ask for the age of the individual and not the exact birthday. This can result in the difference between the estimate that would be provided by a reverse mortgage loan officer and an estimate prepared by the calculator.

The reverse mortgages is a great choice for many seniors as it does not limit them to what they can use the money for. If they want to pay off credit card debt, purchase of long-term healthcare, upgrades to the home, or purchase a new car, it's up to you. I have seen grandparents set up college funds for the grandkids to make sure that funds would be there when they go to college. One of my clients even took a trip to Las Vegas (not recommended) to play bingo.

Jim Saeger RMS

info@MyFloridaReverse.com

MyFloridaReverse.com

Jim who is 62 has lived in Florida for 38 years, and covers Pinellas, Pasco, Hillsborough

and Manatee counties.

He has been a Reverse Mortgage Specialist in the Reverse Mortgage industry for over 12 years and has seen the demand grow for Reverse Mortgage over that time.

Will the New fixed-rate Reverse Mortgage work for you?

I have been doing reverse mortgages since the early nineties and almost from the start I have heard the question “Are they going to come out with a fixed rate reverse mortgage”?.

Well, the day is finally here, the fixed-rate has arrived and a new question is.?

Will it work for you?

There are a few things you should know about the fixed-rate reverse mortgage

Let me explain.

With a fixed rate reverse mortgage you have to do something that I've never recommend when a reverse mortgage is being considered and that is to take all the funds out at closing. I normally recommend the credit line because of its growth rate and when the funds are in the credit line they are not affecting the home equity.

With the credit line the money is available when needed and safe.

With considerations for the fixed-rate reverse mortgage all of the funds have to be taken out at closing in order to get the lowest fixed-rate.

This now puts a senior in charge of finding a safe place to put the money so there's little or no chance of losing it. You can see at this point that this can be a problem because there's always someone out there wanting to invest your money.

The fixed-rate mortgage works best when there's an existing forward mortgage to be paid off that is close to the entitlement derived from the reverse mortgage

Let me give you an example

If the customer is 66 years of age and the home is worth $200,000 with an existing forward mortgage of $90,000 the estimated entitlement would be approximately $100,000 the reverse mortgage would pay off the $90,000 forward mortgage and the senior would only have to contend with investing the $10,000. This could be done with a CD or some other secured instrument. At that point there would be no more payments to be made on the forward mortgage and the interest rate on the reverse mortgage is fixed.

In contrast, if the same 66-year-old were to do a HECM100 reverse mortgage the forward mortgage would be paid off and there would be a surplus or a credit line available of approximately $25,000. If this was left in the credit line the availability would grow each year. So not only is the interest rate lower on the adjustable reverse mortgage (at this time) the money available is increased also.

With reverse mortgage interest rates at an all-time low and the new LIBOR based reverse mortgages now available, unless there is an existing forward mortgage to be paid off or other large debt that needs to be handled, the fixed-rate in my opinion does not appear to be a good choice.

By Jim Saeger Reverse Mortgage Specialist

MyFloridaReverse.com

info@myfloridareverse.com

What to do, what to do.?

One of the major concerns on most senior’s minds, is the fear of either outliving one's money or just not having enough to enjoy life in the golden years. We know the issues with Social Security and even if our finances were properly managed it looks like it will be difficult to make ends meet, the fact is that many boomers are living beyond their means. Debt is at an all-time high in this country. The crisis in the mortgage industry is impacting many people's largest asset, there home and the equity, having those fears are real and justified for the boomers.

Those who have experience the Great Depression feel there primary asset was their home and that the home was something that needed to be passed on to the next generation.

I don't necessarily feel that way in the case of the future generations. They will be using the equity to travel or to meet their own personal needs rather than pass it on to the children.

There's no reason not to pursue your dreams, life is too short. If you're a homeowner 62 or older, a reverse mortgage may help you do what you've always dreamed about...

I have lived in Florida for 38 years, I work with Seniors in Pinellas, Pasco, Hillsborough and Manatee counties.

I have been a Reverse Mortgage Specialist in the Reverse Mortgage industry for over 12 years and have seen the demand grow for Reverse Mortgage over that time.