When Reverse loans initially were offered the public, there was only one that a Senior could select. And it was the FHA Home Equity Conversion Mortgage, otherwise known at the HECM.
It's a great loan and has continued to be the most popular Reverse mortgage. At first when it came out, there was only one variation to chose from and it had a 2.00% margin tied to the 1-Year T-Bill. Eventually that margin was reduced by a half of a percent, making the overall initial interest rate lower and then at a later time, the Libor index was also as another option instead of the 1 Year T-Bill.
As the demand picked up for Reverse mortgages it became apparent that the FHA loan wasn't always able to provide a solution to a Senior that might have a large loan that needed to be paid off. Thus, enter the refinancing mortgage Reverse loan.
I was never much of a fan of them, because they always had refinancing mortgage high interest rates and the costs were huge! They could be as much as $28,000! Yikes! Who in their right mind would want to to one of them?
Eventually, more Lenders came into the market and started offering their own variations of it and it became more attractive with time. It was a great solution for a really ole, Senior who's home was valued at 750K or more and needed more funds than the HECM could provide.
But due to the current mortgage crisis, all of the Reverse Mortgage lenders has stopped offering the Jumbo product. And it's due to the overall decline in real estate value.
It's unfortunate that as of this time, they are no longer an option. Because under certain conditions they were an answered prayer for a Senior who needed a larger amount of money and now they will not have that choice.
For further information on Reverse loans and aging, please visit my blog.
ไม่มีความคิดเห็น:
แสดงความคิดเห็น