Homeowners in the Westlake Village/Thousand Oaks and local areas are
seeking a hassle-free reverse mortgage need to act now to secure one,
as changes to the Federal Housing Administration’s Home Equity
Conversion Mortgage program will make obtaining this financial product
more difficult. Mortgage bankers in Westlake Village/Thousand Oaks can
help local residents obtain a reverse mortgage before the January 2014
rule change.
What Is a Reverse Mortgage?
A reverse mortgage is a financial product that allows seniors to tap
into a portion of the accumulated equity in their homes. With a reverse
mortgage, the borrower retains title to the home throughout the life of
the loan. The borrower cannot, as a result of the reverse mortgage be
forced out of his or her home, as long as property charges, such as
taxes and insurance, are paid and the home is maintained in reasonable
living condition.
When the last borrower on the loan permanently
leaves the property as a primary residence, for whatever reason, the
loan becomes due. If there is equity remaining, the property can be
either refinanced or sold to capture that equity. Two of the great
safeguards for reverse mortgages are that they are structured so that
the borrower or his estate can never owe more than the value of the home
upon repayment. In addition, the HECM products are insured by the
Federal Housing Administration, an arm of the U.S. Department of Housing
and Urban Development (HUD
Over 800,000 reverse mortgages have
been secured by homeowners. Approximately 10,000 baby boomers turn 65
every day – the minimum age for this is 62.
New Rules
New rules are tightening the requirements for obtaining a reverse
mortgage, requiring homeowners to provide more information about their
financial situation to mortgage bankers Westlake Village, Thousand Oaks,
Conejo Valley, and Simi Valley homeowners seeking this will now have to
provide more proof of income and credit to lenders.
According
to the new regulations, lenders will now have to do a more rigorous
assessment of a homeowner’s financial status before issuing reverse
mortgages. Under the new rules, lenders will need to check for:
Any delinquent debt to the federal government borrowers may oweAny
unpaid debts on the property considered for a reverse mortgageCredit
history on credit cards, mortgages and other loansHistory of payment on
property charges
Under the new rules, homeowners will need to
submit more paperwork to lenders regarding their income and their
creditworthiness. This likely will make getting a reverse mortgage more
time- consuming and stressful for homeowners in need of the extra cash
this financial product can provide.
While reverse mortgages will
still be available under the rule change, the burden of verifying
income and credit has increased for bankers. Westlake Village, Thousand
Oaks, Conejo Valley, Simi Valley homeowners seeking this mortgage should
act now, before the January 2014 deadline, to secure a reverse
mortgage, to avoid the increased requirements and avoid unnecessary
hassle.
