The Retire Well Report

What’s Holding Reverse Mortgages Back?

Admin — Thu, 02 Feb 2012 16:47:59 +0000

US News & World Report has published a very insightful article on the state of the reverse mortgage market. According to the article:

“Reverse mortgages should be a breakout product of demographic destiny.

Millions of older Americans are hurtling toward very uncertain retirements. Survey after survey documents a serious lack of retirement planning and nest eggs too small to support even modestly comfortable retirements. Continued longevity gains are extending the retirements of many people to 20 and 30 years, if not longer. Government spending on seniors is threatened by budget deficits and conservative opposition to government programs….

Where will the money to support tomorrow’s retirees come from? Enter the reverse mortgage. It is the only mainstream financial product that permits older Americans to tap the equity in their homes. Reverse mortgages allow homeowners to get money out of their primary residences, and also free them from making future mortgage payments for as long as they live in their homes.”

The article continues to explore reverse mortgages and the reasons why they have not taken off the way you would think. The author has a little misunderstanding about how HECMs work, but all in all this is an excellent commentary on the industry from an outside observer. A whole lot more people would benefit from reverse mortgages with some education of consumers and a little clarity from the government.

Read the whole article.

Consumer Friendly Reverse Mortgage Information

Admin — Fri, 06 Jan 2012 16:17:57 +0000

The National Reverse Mortgage Lenders Association has upgraded their consumer web site to make it easier for people to get information they can understand about reverse mortgages. It is very consumer friendly, and even has a special section for children of seniors so that they can help their parents judge the suitability of a reverse mortgage for their situation. Check it out!

CBC Morning Show Features Long Term Care & Reverse Mortgages

Admin — Thu, 22 Sep 2011 17:21:08 +0000

Dr. Marion, President of 3in4 need more, and Gregg Smith, President of One Reverse Mortgage, talk on the CBS Morning Show about the need for long term care and the potential benefit of reverse mortgages.

Reverse Mortgages and 3in4 Need More

10 Best and 10 Worst Places to Retire

Admin — Wed, 27 Jul 2011 15:19:20 +0000

You may have missed it, but AARP Magazine last year published a list of the 10 worst places to retire. Here it is:

“Here are the 10 worst states for retirement, with No. 1 being the lowest-ranked, according to Money-Rates.com:

10. Arkansas
9. Missouri
8. North Carolina
7. Ohio
6. Tennessee
5. Maryland
4. South Carolina
3. Alaska
2. Michigan
1. Nevada”

The way you read this is that Nevada is dead last. Now, here is the list of 10 best states to retire, “according to Money-Rates.com:

1. New Hampshire
2. Hawaii
3. South Dakota
4. North Dakota
5. Iowa
6. Virginia
7. Utah
8. Connecticut
9. Vermont
10. Idaho”

I have a lot of trouble with these lists because my state is not listed. Although, I amglad that Florida is not one of the 10 worst. I just can’t understand why so many northern states are on the good list. The only snow I want to see is on my television.

Retirement Rescue

Admin — Wed, 29 Jun 2011 12:41:10 +0000

ABC news has just published a report on reverse mortgages indicating that older Americans have nothing to fear with Wells Fargo and Bank of America leaving the reverse mortgage marketplace. Even though these are two of the largest lenders, reverse mortgages continue to be available and existing reverse mortgages continue to be serviced. They also published a video with this report, giving basic information on reverse mortgages – this is a better job than many of the recent attempts by the press to describe reverse mortgages. Watch the video:

Reverse Mortgage – A Valuable Option

Admin — Fri, 03 Jun 2011 12:37:07 +0000

In todays St Pete Times we have a story from the Philadelphia Inquirer about reverse mortgages that is not nearly as misinformed as most media attempts to describe this valuable financial tool for older Americans. This item correctly describes reverse mortgages as far as it goes, but doesn’t really go far enough because it omits any mention that reverse mortgages can also be used to purchase a home. This could be especially valuble to older people who are downsizing or relocating to be near family. Assuming you can sell your home in this market, you would not need to sink all your cash equity into the new home. You could simply make enough of a down payment to get a reverse mortgage on the balance. Then, put the rest of your cash into the retirement fund to generate income, and there you are in a new home with no monthly payments as long as you live in the home – a feature worth mentioning! Another shortcoming of the article is that it applies that lenders charge monthly servicing fees, something which is rarely done any more. Read the article.

Proprietary Reverse Mortgage Loans Will Return

Admin — Fri, 29 Apr 2011 18:18:00 +0000

Proprietary reverse mortgage loan products used to be readily available, but these have all but disappeared with all the turmoil in the real estate markets. Declining home values is the primary culprit, so that the FHA insured home equity conversion loans are all that’s available. The private loans were especially sought for larger homes that exceeded the FHA loan limit – so called “jumbo” loans. There is only one jumbo loan product available today. Reverse Mortgage Daily has an interesting discussion on this, forecasting the eventual return of proprietary reverse mortgage loans. I would agree that this is inevitable, and that the key will be the return of the securities market for these loans.

Home Equity Available to Seniors Declines

Admin — Wed, 20 Apr 2011 18:49:04 +0000

The latest RiskSpan Analysis (March 2011) publishing the Reverse Mortgage Market Index (RMMI) says that the value of home equity held by seniors aged 62 and older fell to $3.4 trillion at the end of 2010. This is down from its peak of $4 trillion in 2006 in the housing boom. It would probably be lower, because of declining housing prices, but it has been offset by the rising number of people in this age group. The population 62 and older is expected to grow from 50 million to 83 million by 2030.

What does it all mean? Probably, it means a lot of things, but it certainly means there is still a lot of home equity out there that could be used by seniors to help themselves live more comfortably in their retirement years, using a reverse mortgage!

Boomers’ Retirement Not a Pretty Picture

Admin — Fri, 04 Mar 2011 15:52:34 +0000

According to a recent article in the Wall Street Journal, retirement for Boomers is not a pretty sight. “The median household headed by a person aged 60 to 62 with a 401(k) account has less than one-quarter of what is needed in that account to maintain its standard of living in retirement, according to data compiled by the Federal Reserve and analyzed by the Center for Retirement Research at Boston College for The Wall Street Journal,” says the article by E. S. Browning. The analysis is based on the recommendation that 85% of working income will be needed for retirement. However, the retirees in my acquaintance all seem to say you need more income in retirement than you had while working! This makes sense when you realize that you have more time in retirement to engage in the activities you love. You can read the article for yourself, but the bottom line is that a whole lot of people are coming up short. This is where reverse mortgages will help. There is no way that a reverse mortgage will make up the difference, but it is certainly a fnancial tool that needs to be a part of the retirement plan.

You might be in Pasco County Report Number one

Admin — Thu, 12 Aug 2010 19:33:50 +0000

You know you are in Pasco County when you read about the local bank robber whose getaway car was an easy to identify vehicle – a white pickup truck with lightning bolts painted on the sides. The cops caught him exactly 6 minutes later. Great plan, there, Joe.