Falling Home Values Cut Into Reverse Mortgages

Once an avenue that senior’s had often sought as a means to help them in retirement however with the falling home values this once thriving popular financing option is in need of  help. The agency that over sees reverse mortgages will have about an $800 million deficit to overcome. With this short fall it will stop about 1 in 5 seniors from having an opportunity to pay off their home mortgage debt with the proceeds of a new reserve loan. That may leave some seniors in danger of falling into delinquency or ending up in foreclosure. A reserve mortgage usually provides a homeowner with a lump-sum payment, monthly payments or an equity credit line - these amount then are secured by the equity in the property and become due and payable with interest when the owners sell the property or cease using it as their residence. Borrowers of a reserve mortgage are guaranteed the right to remain in the home indefinitely even if their debt balance exceeds the property value. The FHA insures reverse mortgages made by approved lenders. For further information on reserve mortgages contact a Mortgage Specialist.

Two more shoes to drop on consumers.

The first is: equity lines of credit are drying up fast as banks can notify their customers that their once line of credit has disappeared with declining property values as the explanation.

The second shoe: credit rating will soon become as battered as home values.

See you at the top because we will help get you there.