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Reverse Mortgage Basics
from:Many consumers can benefit from an introduction to the reverse mortgage. This advance is a type of loan that allows a homeowner to borrow from their home’s value. The reverse mortgage has many interesting aspects to it for some homeowners to consider.
The borrower does not have to pay back any of the money that he uses in the course of the reverse mortgage. The package is designed for retired homeowners who need money but do not want to sell their current residence. Instead of selling, the customer simply borrows money against the value of the home.
The debt is to be repaid when the home is sold or in the event of the borrower’s death. Many elderly clients can benefit from this type of advance because they do not have to worry about repaying the debt. The money owed is simply taken out of the sale price when the home is sold.
But what if the borrower dies? The individual that inherits the home also inherits the debt. This is typically little trouble considering that the value of the home should greatly exceed the cost of paying off the debt. The loan company will work with the person that inherits the property to work out a viable agreement.
There is little risk of owing more than the home is worth. The lender accounts for the initial mortgage amount and the lender figures in the interest rate. The length of the loan and the home’s appreciation are also factored into the agreement. The amount of the money lent will not exceed the value of the home through the term of the loan.
Basic Requirements
A person will be typically unable to get a reverse mortgage if there is a lien on the property. In some cases, the borrower can use money that he receives in the loan to pay off any liens against the house. The lender will require that the lien be paid in full before making an agreement or the consumer will be required to pay the lien using monies from the loan.
The amount of the loan depends on a few factors. The home should be appraised and any necessary repairs must be made. The property’s location is another important component in the lending process. Well sought-after properties will yield more worth.
The interest rate will have an effect on the monthly installment and the overall cost of the loan. The borrower’s age is also a consideration. The reverse mortgage is designed for senior citizens. The older the borrower is, the more money he can receive through the loan.
The consumer has a few choices when it comes to the distribution of funds. He can opt for a lump sum, monthly installments or a line of credit through the reverse mortgage.
Mortgage Application News
Mortgage applications up on refi demand: MBA - Reuters
 Christian Science Monitor | Mortgage applications up on refi demand: MBA Reuters NEW YORK (Reuters) - Applications for home mortgages rose last week, fueled by demand for refinancings as mortgage rates hit fresh record lows, an industry group said on Wednesday. The Mortgage Bankers Association said its seasonally adjusted index of ... MBA Weekly Survey: Refinance Applications Increase Because of Record Low ... Mortgage rates fall, mortgage application volume rises Refinance Activity Drives Mortgage Application Rates Higher Again |
US: MBA Mortgage Applications rose 3.8% last week - FXstreet.com
US: MBA Mortgage Applications rose 3.8% last week FXstreet.com FXstreet.com (Barcelona) - The Mortgage Bankers Association revealed last week's change in mortgage application, indicating a 3.2% rise, following a 9.2% growth in the week before. Trading foreign exchange on margin carries a high level of risk and may ... |
Mortgage Application Volume Rose 9.2% Last Week -- MBA - Wall Street Journal
 Business Insider | Mortgage Application Volume Rose 9.2% Last Week -- MBA Wall Street Journal The number of mortgage applications filed in the US last week rose 9.2% from the prior week, the Mortgage Bankers Association said Wednesday, as renewed economic worries in Europe dragged interest rates to fresh lows. Refinance activity jumped 13%, ... Mortgage Applications Jump; Rates Fall GOOD NEWS: Mortgage Applications Surge 9.2% A Refinancing Boom On European Strife |
Mortgagebot Launches New Consumer Loan Product, Giving Lenders a Complete ... - MarketWatch (press release)
Mortgagebot Launches New Consumer Loan Product, Giving Lenders a Complete ... MarketWatch (press release) The $500 million-asset credit union, which has been using PowerSite for the past eight years to manage its mortgage loan operations, looks forward to improving its consumer lending online applications. "Our credit union has already had great success ... Mortgagebot Expands Online Mortgage Software to Handle Consumer Loan Origination |
UK mortgage activity up 16% year on year, index shows - International Business Times
UK mortgage activity up 16% year on year, index shows International Business Times Using data from more than 500 brokers and 700 estate agents, the National Mortgage Index found that although the number of mortgage applications in April was down 13% on March, activity is still strong and year on year figures are up 16%. |