Reverse Mortgage counseling has taken another turn in the wrong direction in my opinion. The counselors now wield more influence over the borrower’s ability to get a reverse mortgage, whether or not they are qualified to do so. During the process of reverse mortgage counseling, counselors are required to give a pass/fail exam to the borrower who may or may not receive the certificate and may or may not pass go to get the reverse mortgage. If the borrower does not demonstrate basic knowledge then the certificate is not issued. Here is my problem with that.
Posts Tagged ‘Federal Housing Administration’
Reverse Mortgage Counselors Fail
Posted by Michael Manfredi on August 7th, 2010
Reverse Mortgage Concepts Pays Up Front MIP
Posted by Michael Manfredi on August 4th, 2010
Reverse Mortgage Concepts, an Arizona reverse mortgage broker is quoting fixed rate, FHA reverse mortgages with 100% lender paid MIP. Borrowers can elect to have a 5.49% interest rate without having to pay the up front mortgage insurance premium required by HUD, instead, the lender will pay for 100% of the MIP. In addition, another choice of a lower rate, 4.99%, comes without lender paid MIP.
Free Reverse Mortgage Counseling
Posted by Michael Manfredi on July 27th, 2010
The U.S. Department of Housing and Urban Development (HUD) announced today that $79 million (seventy-nine million dollars) will be made available for a broad range of housing counseling including how to qualify for a reverse mortgage in fiscal 2010. In times like these when reverse mortgage counseling can cost as high as $125, the additional money is a welcoming sign that more free reverse mortgage counseling should be forthcoming.
This funding represents a 27% increase over last year. HUD says the primary benefits of the program are to expand homeownership opportunities, improve access to affordable housing and preserve homeownership. Here is a list of some of the types of counseling the funds will pay for:
FHA Insured Reverse Mortgage Monthly Premiums to Rise
Posted by Michael Manfredi on July 27th, 2010
I thought it would be necessary to post this article just after my last “Lowest Reverse Mortgage Fees” because there are definitely some issues of concern about the ongoing costs of reverse mortgages, or any FHA loan for that matter. The last article defined the reasons for the dramatic decrease in up-front closing costs and fees associated with obtaining the reverse mortgage while this article aims to discuss the ongoing fees and charges that appear on a borrower’s reverse mortgage statement and thus, are added to the loan balance.
Lowest Reverse Mortgage Fees
Posted by Michael Manfredi on July 26th, 2010
Reverse Mortgages have come a long way in just the last year or two. The low, fixed interest rate, FHA insured reverse mortgage came on to the scene last year and has taken the industry by storm. This is good news for everyone, including homeowners age 62 and older.
With a very healthy secondary market for these loans, lender premiums have increased to the point where it just made good sense to use these credits to pay borrower fees and closing costs. Fees and costs have long since been one of the major deterrents to the program for some and others just would not qualify for the loan without lenders picking up the tab for some of these fees.
Unlicensed Loan Officers Still Operating in Arizona
Posted by Michael Manfredi on July 18th, 2010
With all of the advanced warning and instructions we received from the state and many other sources, there can be no gray area when it comes to who has to have a license to originate loans in Arizona and how to get one. This is not the case for some loan officers who continue to ignore the SAFE Act requirements set by lawmakers that took affect on July 1, 2010.
Posted in Arizona Reverse Mortgage, Reverse Mortgage 
Tags: Arizona, arizona state laws, azdfi, Federal Housing Administration, HECM, loan officer fines, loan officer license, loan officer training, loan officers, Phoenix Arizona, Reverse Mortgage, reverse mortgage rates, reverse mortgages, state of arizona, United States Department of Housing and Urban Development, unlicensed loan officer 
2 Comments »Top 10 Disadvantages of Reverse Mortgages
Posted by Michael Manfredi on July 13th, 2010
I get the question a lot from prospective borrowers, “What are the disadvantages of a Reverse Mortgage?” It is a very easy question to answer because there actually are a few.
- Reverse Mortgages are Home Equity Loans and they will reduce the amount of equity you have in your home.
If you are in the market for a Reverse Mortgage, you probably are not trying to preserve long term equity, so this may not be a specific concern.
- Reverse Mortgages are currently insured by the Federal Housing Authority (FHA) so the collateral for the loan, your home, must meet the HUD minimum property guidelines.
This is particularly difficult in some instances such as with mobile homes and condominiums.
- Reverse Mortgages are difficult to obtain if your loan closes with your property in a trust.
Posted in Reverse Mortgage Tags: advantages, Arizona, disadvantages, Federal Housing Administration, FHA, Fixed Interest Rate, HECM, Home equity, jumbo reverse mortgage, Phoenix Arizona, rates, Refinancing, reverse mortgage lender, reverse mortgage refinance, United States Department of Housing and Urban Development 2 Comments »Reverse Mortgages and Annuities
Posted by Michael Manfredi on July 12th, 2010
While I agree that a reverse mortgage is not right for everyone, I also see evidence that only a small number of homeowners trust them or the potential opportunities they create. Not everyone uses them to pay off bills or help out a friend. I have recently had reverse mortgage clients use the proceeds of their loans to diversify into gold, annuities and bargain-priced real estate. Whatever the outcome of those investments may be, the one principle that I understand and respect that is being followed here is diversification.
While some may say that to borrower and invest is not right, others will use leverage from margin accounts or short selling which is also borrowing and investing and usually for the purposes of hedging or timing another investment opportunity.
Reverse Mortgage Appropriation Woes
Posted by Michael Manfredi on July 11th, 2010
By now you have probably heard of the $250 million appropriation the Obama administration requested from congress in order to justify the expected losses from the FHA reverse mortgage program in fiscal 2011. A congressional sub-committee assigned a new number recently of $100 million less based on revised annual projections and the severe downturn in 2009 reverse mortgage volume. Even though the program is again, sure to get some kind of a principle loan amount reduction, at this time it’s not quite certain what exactly will happen to the program except that it won’t be as good to seniors as it was, just like last year’s principle loan amount reduction. I remember last year’s cut and how it was projected to reduce volume by 5% but low and behold, here we are down 30%! Now I am sure housing values had something to do with that and how much, I really don’t know. Let’s say the majority of the decrease in volume was from the decline in housing values nationwide and peg the number at, oh I don’t know, 25%. What that means is that the market worked all by itself without any turning of the screws by the fed. It means the principle loan amount reduction was not necessary and the housing crisis corrected the steep growth curve of reverse mortgage volume all by itself, rendering a much lower amount in losses for the program.
Reverse Mortgage for Home Purchase
Posted by Michael Manfredi on March 11th, 2010
Reverse Mortgages have been used for home purchase for many years, however, the federally insured version, HECM, has recently become available for financing a home purchase as well. The advantages of the HECM loan are substantial, like low interest rates and FHA insurance but there are the usual drawbacks, like mortgage insurance fees and HUD property regulations.
