Here is an AP story from today that shows that, because there was no inflatiion this year, there will be no Cost Of Living Adjustement (COLA) to Social Security payments this year or next. Here is the lnk:
http://m.apnews.com/ap/db_8559/contentdetail.htm?contentguid=fuesnPZy]
So, once again Seniors will see a lot of their expenses (heat, food, medication, etc.) go up and have no increase in their fixed income.
Clearly, the need for Reverse Mortgages will only grow in this environment. Hopefully, Congress won't screw up the product and will allow it to continue to help so many people.
First the good news: In "The Sokesman," Tom kelly writes avery good (and short) article about how Reverse Mortgages should not be labeled as "bad" or similar to "subprime." He really hits the nail on the head. Here is the link:
http://www.spokesman.com/stories/2009/aug/16/reverse-mortgages-shouldnt-be-lumped-into-bad/
In contrast; Consumer Reports has an article this month about Reverse Mortgages that is horrible. I can't even imagine a worse piece if I tried. Every negative is emphasized, including Senatir Mckaskill's ridiculous hearings and HUD's request for more money to subsidize the potential for losses (of course the author does mention that the losses may never happen.)
This is another example of the fearmongering and one-sided reporting that had been the norm for many yaers and that, to this day, has probably misled millions of people into thinking that Reverse Mortgages are some kind of trap to take away senior citizens homes.
I am thoroughly disgusted by the article and if you want to be disgusted too, here is the link to it:
Fox Business News had a short piece on Reverse Mortgages last week. The two anchors are pretty ignorant about the product and the guest, Jim Randel was okay, but not great. He defends againast the notion of "just sell the house", but then he said that a HELOC is a better choice if you can qualify for it.
The truth is that they are far from interchangable. For starters, A HELOC requires monthly payments and is finite. A HELOC will provide monthly revenue for as long as a borrower still lives in the home.
Here is the link: http://www.foxbusiness.com/search-results/m/25692489/is-a-reverse-mortgage-right-for-you.htm#q=Randel
I never thought I would be fascinated by a Presentation from the Governmnet, but the Reverse Mortgage Piece from HUD, published last Demeber really had me enthralled. I found it through Reverse Mortgage Insight and here is the link:
http://rminsight.net/blog/wp-content/uploads/2009/08/hud-szymanoski-cushman-hecm-finance11-30-08.ppt
It's 44 pages long and a little technical at times, but in it you will learn:
HUD's role in The Home Equity Conversion Mortgage (HECM -This is the FHA Reverse Mortgage Process - Page 3
How the Government may take losses and that as of December of last year- the governmnet has not only taken no losses on the HECM program, but is actually taking more premiums than forecasted losses. Pgs 4-6 14-15
How Reverse Mortgage loan amounts are determined. Pgs 8-11
Why long term losses are more tied to the Real Estate market than anything else. Pgs 16-17
What happens to Reverse Mortgages in the Secondary Market. Pgs 16-43
What an Interest rate swap is. Page 27
I really learned a lot and anyoen with a basic understanding of how Reverse Mortgages work should also find it educational
The Baby Boomers started turning 62 last year (2008) and over 15 million people will turn 62 every year for the next seventeen years.
Over 84 percent of senior respondents said that they wantto stay in their home for the rest of their lives.
The U.S. Department of Census estimates that by 2020, nearly 14 million Americans will be over 85.
The fastest growing segment of the population NOW is over 65.
Approximately 2 million elderly people pay privately for home health care.
There is just no doubt that the need for Reverse Mortgages will continue to grow for the foreseeable future.
 |
|
|
THE Reverse Mortgage Blog
ActiveRain Corp. is not responsible for the accuracy of the site's content (which is written by members of the ActiveRain Real Estate Network) and does not endorse the views of the real estate agents, mortgage brokers, and others listed here.
Powered by the ActiveRain Real Estate Network
© 2009 ActiveRain Corp. All Rights Reserved
