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Reverse Mortgage Basics
Loan & Credit FactsMany 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 For Reverse Mortgage
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 News Specific links
Mortgage News News
Freddie Mac: 30-year mortgage rate down a tick at 3.78% - Los Angeles Times
 The Mortgage Reports | Freddie Mac: 30-year mortgage rate down a tick at 3.78% Los Angeles Times By E. Scott Reckard Record low interest rates for 30-year mortgages edged down another tick, Freddie Mac said in its latest survey, which showed lenders across the nation offering the benchmark loan at 3.78% compared to 3.79% last week. Mortgage Rates for 30-Year US Loans Fall to a Record-Low 3.78% 30-year mortgage rate hits another record low US 30-Year Mortgage Rate Falls to Record 3.78 Pct. |
More than 30% of mortgage borrowers still underwater - CNNMoney
 Los Angeles Times | More than 30% of mortgage borrowers still underwater CNNMoney By Les Christie @CNNMoney May 24, 2012: 5:23 AM ET Homeowners who were underwater on their mortgages rose in the latest quarter, even though home prices have slowly started recovering. NEW YORK (CNNMoney) -- Despite rising home prices, more than 30% of ... Half of metro Atlanta mortgages underwater Negative equity remains a drag on housing market 44% of Cook County homes with a mortgage are underwater |
Supreme Court says families cannot sue mortgage company over loan discount fee - Washington Post
 KIMA CBS 29 | Supreme Court says families cannot sue mortgage company over loan discount fee Washington Post WASHINGTON — The Supreme Court ruled unanimously Thursday that three families cannot sue a mortgage company for allegedly charging them a loan discount fee without giving them a lower interest rate. The high court's decision tosses out lawsuits filed ... Court: Families cannot sue over loan discount fee Supreme Court says families cannot sue company over loan discount fee | The ... Supreme court limits reach of 1974 real estate law |
American Capital Mortgage Investment Corp. Announces Pricing of Public ... - MarketWatch (press release)
American Capital Mortgage Investment Corp. Announces Pricing of Public ... MarketWatch (press release) BETHESDA, Md., May 24, 2012 /PRNewswire via COMTEX/ -- American Capital Mortgage Investment Corp. (NASDAQ:MTGE) ("MTGE" or the "Company") announced today that it priced a public offering of 11000000 shares of common stock for total expected gross ... American Capital Mortgage Investment Prices Stock Offering American Capital Mortgage Investment Corp. Announces Public Offering of Common ... |
Bankrate: Mortgage Rates Hold at Record Lows - MarketWatch (press release)
 San Francisco Bay Area Today (press release) | Bankrate: Mortgage Rates Hold at Record Lows MarketWatch (press release) NEW YORK, May 24, 2012 /PRNewswire via COMTEX/ -- Mortgage rates were little changed, remaining at record low levels. The average rate on the benchmark 30-year fixed mortgage rate was unchanged at the record low of 3.97 percent according to ... Mortgage Rates Remain at Record Lows Mortgage Rates Today: Wells Fargo, PNC Bank and KeyBank Refinance Rates for ... Today's Mortgage Rates for 5/24/12 |