Currently viewing the tag: "Federal Housing Administration"

Reverse Mortgage Borrower Assessment Explained

By On August 3, 2011

The implementation of a financial assessment tool is now imminent for reverse mortgage applications.

After Wells Fargo recently exited the business, citing borrower tax defaults as a major reason, the issue has been front and center for industry execs.

There is talk about a uniform 50% debt to income ratio being applied to all new reverse mortgage applications. Debt to income ratios would be assessed after the benefit of the reverse mortgage proceeds were taken into account. Your monthly scenario could look somthing like the following.

Before the reverse mortgage:

$1000  mortgage payment (including taxes and insurance)

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Reverse Mortgage, Now Is The Time

By On June 28, 2011

With all of the changes in the reverse mortgage industry lately, it can be stunning when researching lenders and products. It is important to know that even with the decisions of Wells Fargo and Bank of America to exit the reverse mortgage business, there remains a core group of lenders that use 100% of their resources to deliver reverse mortgages to borrowers over age 62, nationwide.

These lenders are an elite group of banks that specialize in reverse mortgage lending and have vast experience with these loans. While other banks are pulling out, these lenders keep growing and expanding and making reverse mortgages more affordable than ever.

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4.99% with 1.25% MIP or 5.56% with .50 MIP?

By On September 30, 2010

It’s really a personal decision as to whether or not to chose the newer MIP of 1.25% vs. .50%. If you have the choice, the newer loan with the higher MIP will yield more money, as stated in another post but what will be the difference in the ongoing costs? They will be higher but how much? Simple math will fix this and make your decision much easier.

Current loan note rate 5.56%

Plus current MIP .50%

Total Annual Rate 6.06%

New loan note rate 4.99%

Plus new MIP 1.25%

Total Annual Loan Rate 6.24%

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4.99% Fixed Rate Reverse Mortgage Prevails

By On September 29, 2010

As predicted by some, the lowest, fixed rate, reverse mortgage is quickly becoming the “go to” product for the industry. Boasting the highest pay out to the borrower and the lowest fixed rate available, the product has the added benefit of a note rate lower than the new HECM expected interest rate. By lowering the expected rate on the new HECM, HUD provided an unexpected benefit to the borrower along with the unfortunate higher MIP tacked-on to the ongoing fees in the program.

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FHA Reverse Mortgage Fees Change Again

By On September 29, 2010

Recent changes in the HUD insured reverse mortgage program has left some of us scratching our heads, again. The program, once described by many as “Too good to be true,” is having a hard time living up to that comment in light of the new fee changes set to go into affect in October of this year.

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