Monthly Archives: April 2016

SNOWBIRD MENTALITY: How to buy a vacation home in the sunbelt with NO mortgage Payments!

SNOWBIRDS: So, it’s winter at home and there’s no place nearby to go and relax. SNOWBIRDS do it every year. They take a motorhome or get a vacation home in the sunbelt, leaving the ice and snow behind.

NOW you can buy the home away from home with a HECM on your primary home in the ice belt, get up, and get on in the winter months into sunshine, golf or 4 wheeling. Why not?

JUST WRITE A CHECK! No payments if that’s your choice.

A reverse mortgage is a loan that enables Homeowners who are at least 62 years old to convert some of their home equity into cash, a line of credit, or to finance a home purchase with the freedom from monthly mortgage payments. The borrowers continue to live in their home in the summer where it’s nice and warm and a real vacation home in the winter where it’s warm and nice

The road to a comfortable retirement is paved with unexpected twists, turns and rocky terrain that can derail your journey. In the event retirees find themselves strapped for cash, there are several ways they can increase their spendable income using a reverse mortgage, says one personal finance columnist.

Reverse mortgages have often been touted as financial solutions for homeowners who are “house rich,” but “cash poor.” They can also be viable tools to help homeowners free-up funds

They can also be particularly helpful for homeowners looking to increase their monthly cash flow, while also freeing-up funds paid on housing related expenses.

“Our homes can be costly beasts,” writes finance columnist Scott Burns in a recent article published by the Houston Chronicle. “Even if there is no mortgage, there are bills to pay. The real estate tax, insurance, utility, repair and other bills remain.”

In the article, Burns provides several examples of how a reverse mortgage can increase the spendable income for a retired couple, aged 66 and who own their $300,000 home free of mortgage debt.

Burns also assumes this couple lives in a high-cost area, so the operating costs on their home are 4% of its value, or $12,000 per year. As medium-income workers, the couple’s combined benefits total $37,000 per year. After paying their shelter bills, they have $25,000 to live on.

“Can they do it? Sure,” Burns writes. “Millions of lower-income retirees get by on far less. Will they be comfortable? That’s doubtful.”

One way this couple could increase their spendable income would be by getting a reverse mortgage line of credit, or a guaranteed lifetime monthly payment.

Using an online reverse mortgage calculator, Burns finds that the couple, which he has dubbed “The Shortcashes,” would be eligible for a net credit line of $164,700, or a monthly payment for life of $938 per month, $$11,256 per year.

“So cash advances will cover the annual cost of shelter, and their spendable income increases from $25,000 to $36,256,” Burns writes. “That’s an increase of nearly 50 percent—all tax-free and without moving.”

The Shortcashes could also choose to move into a lower-cost area, particularly where the annual cost of operating a house is about 3% of market value.

“In that move they can buy a house for about $300,000 with a purchase-money reverse mortgage, putting down less than 50 percent,” Burns writes. “With the purchase-money reverse mortgage, they will have no mortgage payment and will be able to stay in the house until they die or are no longer capable of living there.”

The lower operating expenses of $9,000 will also be nice, he adds.

See contact information in navigation bar for details.

 

 

HECM Mortgages Play Vital Role in Planning for the Costs of Aging

Buckle up; aging can be difficult; you can make it easier/better with HECM

YOU CAN DO A PRIVATE HECM — IN A BUNCH OF THE UNITED STATES with a knowledgeable 12 year veteran of this product located in YUMA, AZ — SO, WHY WOULDN’T YOU DO IT NOW? Nobody would have to tell anybody you did it … and you would be “HAPPY AS A CLAM”WITH YOUR EXTRA MONEY
These are my answer to questions “experts” wrote in a magazine recently about HECMs (reverse mortgage to the uninformed). There seems to be a lot of people ready to smear the REVERSE MORTGAGE. CONSIDERING the value  of a HECM, you have to wonder why, don’t you? A well positioned magazine was left in my office this week after an application signing so I’ll answer the questions they asked, here… (You tell  me if you think I’m wrong about this???)
  • How long to you plan to stay in the house? How ’bout a better question? How long do you plan to live anywhere? But it’s not a bad question. If you are moving soon, consider a HECM somewhere else.
  • Is there another way to meet your money needs? No. The equity in your house is yours to spend, isn’t it? — you can use it and never repay it. What’s not to like?
  • Will your home suit you as you age? Probably not. Use some of the money you’ve been paying on your mortgage and improve it as you age — add grab bars, ramps, improved technical gadgets, eat out more often. Give some to the church, kids, poor people, ???
  • Can you live there if something happens to your  spouse? (They really did ask this one, believe it or not). How will you live anywhere else if something happens to your spouse? Life gets harder anywhere, doesn’t it? Make sure the spouse is listed as a borrower and the issues are reduced. Plan now to stick it out if you can.
  • IF YOU CAN’T — SELL THE HOUSE AND PAY OFF THE MORTGAGE ANYTIME YOU WISH. What’s not to like? Together you will solve the aging issues better if you have a HECM.
  • People who ask you take take another round at a forward mortgage with payments don’t always have your best interest. Buckle up folks, aging is hard, but a HECM makes it easier, not harder — and if you still have equity, you can use it and thrive in retirement.
  •  Thank you.
  • See contact information in navigation bar for details.