Non-Borrowing Spouse Pitfalls. As with any new policy often more questions arise than answers. HUD’s recent Non-Borrowing Spouse policy is no exception to this rule. While benefiting younger spouses with the peace of mind of being able to remain in the home after the death of their spouse what pitfalls and problems can arise?
Continue readingThe Coming HELOC Crisis & Opportunity
The next mortgage bubble with pending HELOCs written in the mid 2000’s could spell opportunity for reverse mortgage lenders and originators alike. A recent study by TransUnion echoes what some mortgage experts have been warning us of in the last year: there is a coming HELOC bomb that could explode in the coming years.
Continue readingAn Ounce of Prevention?
Preventative Measures: Curbing Technical Defaults. An old saying reminds us “ An ounce of prevention is worth a pound of cure.” When it comes to technical defaults for HECM borrowers we may be seeking a cure but there are some preventative measure that can be taken today.
Continue readingHECM: A Mortgage or Social Program?
Is the federally-insured reverse mortgage a social program or a mortgage loan? The question should be addressed as it goes to the heart of recent program changes, restrictions and requirements. While few argue the HECM program is a social program many often lament that the loan no longer serves the needy, cash-poor or typical borrowers or the past due to principal limit reductions and further loan restrictions.
Continue readingNon-Borrowing Spouse Policy: A Wrench in the Gears?
What may have gone unnoticed by some may in fact turn out to be one of the most momentous policy decisions in the history of the HECM program: the non-borrowing spouse provision.
Continue readingHaven’t We Learned?
The Wall Street Journal recently reported that more homeowners are once again tapping into their home equity. As home values recover and interest rates remain artificially low many are beginning to take out HELOCs or Home Equity Lines of Credit to fund home renovations, pay off higher interest rate debts or cover other expenses.
Continue readingThe Non-Borrowing Spouse Surprise?
The Home Equity Conversion Mortgage or HECM program still only allows borrowers 62 or older but now adjusts proceeds based on the age of the younger non-borrowing spouse. In essence it gives the non-borrowing spouse the right to remain in the home indefinitely during a ‘deferral period’ provided requirements are met. That said there are a few key points we must now to fully comprehend the benefit and risks of this policy change…
Continue readingNEW Principal Limits Demystified
Last week we saw two watershed events for the federally-insured reverse mortgage program. Revised Principal Limit Factor tables and the inclusion of younger non-borrowing spouses under the age of 62. The pace of changes to the HECM program has been swift with FHA’s new authority to make substantial changes via Mortgagee Letter rather than the lengthly rule-making process.
Continue readingThe Summer of Change
The remaining months of summer are certain to accelerate further changes to the federally insured reverse mortgage program. First is the long anticpated and often delayed Financial Assessment…
Continue readingInterview with AAG CEO Reza Jahangiri (Part 2)
AAG CEO Reza Jahangiri discusses the future impact of the financial assessment, strategies to succeed in a changing marketplace and more.
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