Reverse Mortgage Guides

Reverse Mortgage Guides is non-profit organization whose mission is to educate homeowners about the pros and cons of FHA reverse mortgages. The Reverse Mortgage Guides Association publishes articles and tools for seniors who are considering a reverse mortgage and want to become fully educated before making a decision. The Association also provides testing and certification to its member organizations.

	What is a reverse mortgage? It is a type of mortgage that is offered through the FHA (Federal Housing Administration) and is available only to homeowners aged 62 or older. It is different from all other types of mortgages because it is a loan that does not have to be repaid for as long as the homeowner lives in the property. A reverse mortgage is often used to fully pay off an existing mortgage and thereby cease making monthly payments. The second most common use, according to the AARP's 2006 survey, is to pay for medical and daily living expenses.
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Reverse Mortgage News

Breaking News: New HUD Mortgagee Letter Released on Refinancing Existing HECMs

Breaking News: A new HUD Mortgagee Letter was released on Tuesday, HUD Mortgagee Letter 2009-21. The letter covers the HECM refinancing of existing loans. Some important points: - A technical correction to 73 FR 51596 and the 24 Code of Federal Regulations (CFR) Part 206 stating that the FHA will insure all loans that we originated for the purpose of reginancing an assigned loan that is not in a due and payable status for reasons that cannot be corrected, but closed on or after October 6, 1008. - A mandatory "anti-churning disclosure" requirement as a consumer protection measure for all refinanced HECM.s. The Anti-Churning disclosure form must be signed by the mortgagor and be included in the FHA case binder. The form, designed to ensure that the HECM refinance will benefit the mortgagor, requires that the mortgagee provide the mortgagor with its best estimate of the total cost of refinancing to the mortgagor and the increase in the mortgagor's principal limit as measured by the estimated initial principal limit on the HECM refinance less the current principal limit on the existing HECM. The mortgagee must also provide the mortgagor with the best estimate of funds available to the mortgagor minus any closing costs/fees. ...

New Concept for Senior Housing

A new concept for senior housing was profiled in the New York Times today. The article focused on Fox Hill, a new senior housing complex outside Bethesda, MD. Rather than only allowing seniors to rent rooms on a monthly payment or requiring them to pay a high entrance fee which is partially refunded when they either pass away or move out, Fox Hill allows seniors to own their homes. Yet they still receive many of the same benefits that come with living in a senior home, including communal meals, social activities, and access to health care. In home care is available at an additional fee, and assisted-living units are also within the same building, enabling couples to live close to one another while one requires more assistance. ...

Frequently Asked Reverse Mortgage Questions: Part 2

Part 2 in our popular frequently asked questions series is below. More to come! Q: Is a reverse mortgage taxable? No. The proceeds of a reverse mortgage do not count as income and are not taxable accordingly. Furthermore, the interest on a reverse mortgage is tax deductible when it is paid. However, the borrower must still pay taxes on the property....

This Week's Reverse Mortgage Rates: June 30, 2009

This week’s reverse mortgage rates are below. These rates are effective for the week beginning June 30, 2009. APR: HECM 300: 3.48 HECM 325: 3.73 HECM 350: 3.98 HECM LIBOR 250: 2.810 HECM LIBOR 275: 3.060 HECM LIBOR 300: 3.310...

HECM for Purchase Program Featured in NYTimes

Friday featured a welcome piece of publicity for the reverse mortgage industry: Bob Tedeschi's mortgage column in The New York Times was about the HECM for Purchase Program. Now that the new underwriting procedures for HECM for Purchase loans have been laid out in a recent HUD mortgagee letter, HECM for purchase loans are beginning to close. However, as the article points out, New York has not been well represented in that mix due to the fact that HECM for Purchases cannot currently be used to purchase a co-op. ...

Frequently Asked Reverse Mortgage Questions: Part 1

Some reverse mortgage questions get asked over and over again. In honor of that, answers to some common reverse mortgage questions are below. More questions will be posted at a later date: Q: Can my heirs still inherit my home? Yes. In a reverse mortgage, the estate is still passed to the heirs. Often, the heirs choose to sell the home with the proceeds going towards repaying the reverse mortgage. The lien cannot be for more than the home is sold for, so if the home is sold for less than the value of the lien, the lender must make an insurance claim for losses to the FHA. Once the home is sold, the estate owes nothing. If, however, the heirs wish to keep the home, they can pay back the reverse mortgage through cash or other assets. They can also refinance the reverse mortgage into a conventional forward mortgage. Q: Can I outlive a reverse mortgage?...

NAR Raises Concerns About Appraisals and Proposes Expanding Tax Credits

In a report published on Wednesday, the National Association of Realtors (NAR) proposed that Obama's tax credit for first time buyers should be expanded across the market to all buyers. Concerns were also raised about appraisals. Lawrence Yun, the NAR's cheif economist, cited the appraisal problem as "serious," and characterized by buyers using appraisers who are not from their neighborhood or who are comparing their property to distresed or damaged homes. These appraisal problems are allegedly pulling down home values, and hurting the industry....

NRMLA Releases New Ethics Advisories

NRMLA released two new ethics advisories today: 2009-01 “Ethical Offers of Other Financial and Insurance Products and Services”, which covers recommendations for following the new rules and restrictions laid out concerning cross-selling, including those in the McCaskell ammendment and the recent HUD mortgagee letter. The other ethics advisory, 2009-02 “Lead Generation State Licensing Requirements and Ethical Advertising”, covers lead generation activities, and reiterates the NRMLA ethics committee's intention to report or publicly name violators. NRMLA members and nonmembers alike should read these advisories, as the ethics committee also announced its authority to remand non-member violators and report them to the approrpriate authorities.

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Existing Home Sales Rise As Prices Fall

Existing home sales rose in May according to a report released to day by the National Association of Realtors. The level of 4.77 million homes is a 2.4% increase from an adjusted 4.66 million homes in April. However, it remains 3.6% below last year's levels. The increase in homes sold is attributed this time to many returning buyers, who are gravitating towards existing home sales rather than distressed properties. Distressed sales fell to 33% of the sales in May, versus 45% of the sales in April. Yet the median home price, of $173,000 is still down 16.8% from a year earlier....

This Week's Reverse Mortgage Rates: June 23, 2009

This week’s reverse mortgage rates are below. These rates are effective for the week beginning June 23, 2009. APR: HECM 300: 3.51 HECM 325: 3.76 HECM 350: 4.01 HECM LIBOR 250: 2.817 HECM LIBOR 275: 3.067 HECM LIBOR 300: 3.317...