Reverse Mortgage Utah - REVERSE MORTGAGES ARE NOT FOR EVERYONE!

 

REVERSE MORTGAGES ARE NOT FOR EVERYONE!

 

If your home is fully paid off, and

 

If you have enough cash in the bank, and

 

If you have a monthly income sufficient to pay all your bills,

 

YOU DO NOT NEED A REVERSE MORTGAGE!

 

But

 

If you are still making mortgage payments, or

 

If you need to have more cash in the bank, or

 

If you need more monthly income to live comfortably, or

 

If you need a lump some of cash to pay off bills, or

 

Help a child go to college, or pay for a mission, or

 

Travel or do or buy??

 

MAYBE A REVERSE MORTGAGE IS FOR YOU!

 

For some a reverse mortgage is not needed; but

For others a reverse mortgage is a God-send.

 

Lillie and Jim purchased a home in 2005:

Purchase Price…………$220,000.00

20% Down Payment...........44,000.00

30 Yr. @ 6.82%..............$176,000.00 loan amount

 

Their principle and interest payment was $1,000.00 a month for 30 years. There are

360 monthly payments in a 30 year loan (12X30=360). In five years they had made 60

payments but still had 300 ($1,000.00) payments left to pay. In other words they had

paid $60,000.00 of the $360000.00 but still had $300,000.00 more to pay. They still had

25 years to go or 300 more $1,000.00 payments.

 

In the 2008 market crash they lost their investments and retirement income. In August of

2010 Jim’s company downsized and Jim lost his job. They were not able to survive on

their meager social security payments.

 

Their children volunteered to make the mortgage payments or assume the loan. That was

another 300 ($1,000.00) payments for another 25 years, totaling $300,000.00.

 

Would it be wise for anyone to pay $1,000.00 a month, for the next 300 months to live in

their home, if they didn’t have to? Consider the costs so far:

 

Down Payment………………………………...………..$44,000.00

Five years P.I… ………………………..…………….…..60,000.00

Property taxes and insurance ($300.00 X 60 months)……18,000.00

30X40 two story barn and other improvements…….….....36,000.00

Total cash in the home…….............................................$158,000.00

Is it wise to pay another?……………….…….…….….…300,000.00

Total cost plus 25 more years for taxes and insurance.....$458,000.00

 

After five years they still owed about $161.000.00 with 300 payments left. With no

income they immediately fell behind in their house payments.

 

WHAT WERE THE OPTIONS?

 

1. Let the home go into foreclosure

2. Ask the children to make the mortgage payments

3. Put the home on the market and try to sell it.

4. Refinance the home

5. Rent out the home.

6. Get an FHA Reverse Mortgage Loan

 

CONSIDERING THE 6 OPTIONS!

 

1. Let the home go into foreclosure.

 

Unthinkable: lose our $158,000.00 investment, our credit and a place to live.

 

2. Let the children make our mortgage payments.

 

Unthinkable: Nice to know they offered and are capable but they have their own

expenses and trials. We do not want to become a financial burden on our children.

 

3. Put the home on the market and try to sell it.

 

Unrealistic: The chances of selling a home in this market at a fair price are very

poor. It is also very expensive to sell (8-9%) and we would have only a little cash

after paying off the loan and no place to live.

 

4. Refinance the home.

 

Impossible: Must have good income and qualify for the loan because you must make

payments for the duration of the loan. With no job it is impossible to refinance.

 

5. Rent out the home.

 

Impractical: The mortgage payments are more than the home could be rented for in

today’s market. And…where would Lillie and Jim live?

 

6. Get an FHA Reverse Mortgage Loan.

 

Practical: About 5% in costs; and because there are no mortgage payments we

needed no credit or income. We had already put many thousands of dollars into our

home. This option allowed us to stay in our home as long as we wished with no more

mortgage payments for the rest of our lives. For Lillie and Jim this was the perfect

solution.

 

Getting a Reverse Mortgage is less expensive than selling a home through a real

estate broker. The Reverse Mortgage costs about 5% of the appraisal; selling with a

broker costs about 8-9%. The seller of real estate has higher sales costs and pays taxes

on profits. The individual getting a reverse mortgage always owns his property, gets to

live in the home with no mortgage payments forever, gets tax free money, and focuses on

savings, not expenses.

 

HOW MUCH IS THE REVERSE MORTGAGE SAVING?

 

If Jim and Lillie live 5 years they will save $60,000.00 in mortgage payments.

If Jim and Lillie live 10 years they will save $120,000.00 in mortgage payments.

If they live 15 years they will save $180,000.00 in mortgage payments

If they live 20 years they will save $240,000.00 in mortgage payments.

If they live 25 more years they will save $300,000.00 in mortgage payments.

 

What Happens In The End?

 

When does the Reverse Mortgage have to be paid off?

1. When the home is sold.

2. When the home is no longer the primary resident of the senior couple.

3. A year after the death of the last senior living in the property.

4. A year after the last senior abandons the property (i.e. rest home, etc.)

5. If the taxes and insurance are not paid, or the property not kept in repair.

 

When the time comes to pay off the loan, if the amount of the loan is more than the

property is worth, the children can let the home go back to the lender. The property will

then be placed on the market at a fair market value and sold on the open market as in a

normal real estate sale. Any losses to the lender will be paid by the insurance company

that insured the loan originally. If the heirs are interested in buying the property they can

purchase the property when it is offered for sale on the open market. Regardless of how

much the loan has grown the heirs are not responsible for it.

 

The reverse mortgage is a non-recourse loan. A non-recourse loan is a loan which

does not allow the mortgage company or anyone else to go to court and get a deficiency

judgment because they lost money on their loan. In other words, if there is a loss of

money when the property is sold and the lender cannot recover the full amount owed

on the mortgage, the lender can not come after the owners to recover any financial loss

whatever.

 

If the amount of the loan is less than the market value of the property the heirs may

choose to sell the property and make a profit. Or they may elect to refinance the property

and occupy the property themselves. The heirs will never have to pay more than the

property appraises for at the time of the future sale.

 

The Future Real Estate Market?

 

How unstable will our economy be in the future? Two or three years ago we could

have sold our properties for much more than they are worth today. Some have struggled

and paid off a home mortgage of $200,000.00 only to see the market sink, buyers drop

off and property values tumble to 50% of what they paid for their property. No one can

predict the future. The home your children inherit from you could be worth a million

dollars or next to nothing, depending upon things completely out of your control, the

economy.

 

IN SUMMARY: No one can predict what 10 or 20 years will bring. Today you

might be able to get a $100,000.00 reverse mortgage on your home; next year it will be

more or less, depending on the market. Two or three years ago you could have gotten

much more than you can today.

 

801-277-5100 Legend Financial Services specializes in Reverse Mortgages. Based in Salt Lake City, Utah. Purchase a Home with a Reverse Mortgage. Reverse mortgages can be used to purchase a home. For example, seniors that wish to downsize can sell their existing home, make a large down payment on a smaller home, and finance the rest with a reverse mortgage. Then, no payments will need to be made for life. http://www.legendfinancialservices.com/

Watch a Video at http://www.youtube.com/watch?v=ejzyNK3c2qg

Reverse Mortgage Salt Lake City, UT (801)-277-5100

7 Gas Saving Myths Busted

If you're like most drivers, you've probably come across several quick fix ideas to help improve fuel economy. But many of these ideas are urban legends that don't actually improve gas mileage. Here are seven of the most popular:



1. Morning Fill-Ups Get You More Gas:

Fluids are denser at lower temperatures, so if you fill up your gas tank in cold weather you'll get more gas, right? Wrong. Gas tanks are kept at a set temperature, so there's no benefit in waking up early to buy fuel.



2. Turning Air Conditioning Off and Rolling Down Windows Increases Fuel Economy:

Running your vehicle's air conditioning is no worse for your gas mileage than driving with your windows down. As your vehicle speeds up, air flow creates a drag against the vehicle, making the engine work harder and hurting gas mileage. In fact, air conditioning can be a more efficient option at higher speeds.



3. Letting Your Engine Idle Uses Less Gas Than Starting and Stopping: Modern vehicles use more gas while idling than they do starting the engine, so when you park your vehicle for a short period of time, you save fuel by turning the engine off and restarting it. And it's illegal in Utah.



4. Spoilers Add to the Aerodynamics of a Vehicle, Increasing Gas Mileage: Spoilers add additional weight to your vehicle, making your engine work harder and lowering gas mileage. Getting rid of unnecessary junk, such as an old toolbox in the trunk, is a great way to lighten your load and increase your fuel economy.



5. Dirty Air Filters Lead to Bad Gas Mileage:

Keeping your vehicle's air filter clean doesn't increase gas mileage. Your engine's performance may lag if the air filter is clogged, but it won't make a noticeable change in your fuel economy.



6. Purchasing Premium Gas Increases Fuel Economy:

Each make and model of vehicle requires a specific octane to run efficiently. Using a higher octane than required can make it harder for the engine to burn fuel, resulting in lower gas mileage.



7. Chemical Additives Make Your Vehicle's Engine More Efficient:

If a five dollar bottle of fuel additives could drastically improve gas mileage, gas stations would be scrambling to add it to their fuel. No additive can make gasoline burn more slowly, so don't bother wasting your money.



If you want to save some real money, call Mark Hammond to refinance your mortgage. 801-277-5100. http://www.legendfinancialservices.com

Reverse Mortgage Salt Lake City, UT (801)-277-5100

 

Reverse Mortgage Salt Lake City, UT  | (801)-277-5100 

 

A reverse mortgage is a form of equity release (or lifetime mortgage). It is a loan available to home owners or home buyers over 62 years old, enabling them to access a portion of the subject home's equity. The home owners can draw the mortgage principal in a lump sum, by receiving monthly payments over a specified term or over their (joint) lifetimes, as a revolving line of credit, or some combination thereof. The would be home buyers, would use the existing equity on the home they intend to acquire, to get a reverse loan with a down payment and no additional payments.

 

 

 

In a conventional mortgage the homeowner makes a monthly amortized payment to the lender; after each payment the equity increases by the amount of the principal included in the payment, and when the mortgage has been paid in full the property is released from the mortgage. In a reverse mortgage, the home owner is under no obligation to make payments, but is free to do so with no pre-payment penalties. The line of credit portion operates like a revolving credit line, so a payment in reduction of a line of credit increases the available credit by the same amount. Interest that accrues is added to the mortgage balance.

 

Title to the property remains in the name of the homeowners, to be disposed of as they wish, encumbered only by the amount owing under the mortgage.

 

If a property has increased in value after a reverse mortgage is taken out, it is possible to acquire a second (or third) reverse mortgage over the increased equity in the home in some areas. 

 

However most lenders do not like to take a second or third lien position behind a reverse mortgage because its balance increases with time. It is rare to find reverse mortgages with subordinate liens behind them as a result. A reverse mortgage may be refinanced if enough equity is present in the home, and in some cases may qualify for a streamline refinance if the interest rate is reduced.

A reverse mortgage line is often recorded at a higher dollar amount than the amount of money actually disbursed at the loan closing. This recorded lien is at times misunderstood by some borrowers as being the payoff amount of the mortgage. The recorded lien works in similar fashion to a home equity line of credit where the lien represents the maximum lending limit, but the payoff is calculated based on actual disbursements plus interest owing.

Reverse Mortgage Utah - Home Loans for Seniors

Reverse Mortgage Utah - Home Loans for Seniors Call  801-277-5100

 

 

Reverse Mortgages

“I’m retired and my income is low. I have a lot of equity in my home, but it does me no good unless I sell the house. But I need a place to live! I wish there was a way to stay in my home and stop making mortgage payments. I would love to get at some of that equity to pay for prescriptions, medical costs and spoiling my grandchildren. Can’t the lender just let the interest build up on my loan and collect it later after I die? Right now I need a break!"

Home Equity Conversion Mortgages (HECMs), commonly known as reverse mortgages, are Federal Housing Administration insured low-interest home loans for seniors (over 62 yrs) that require no payments EVER as long as the seniors live in the home. Existing loans can be paid off and equity can be drawn out to pay for medical expenses, living expenses, or whatever the borrower chooses. The maximum loan amount is a percentage of the home's value determined by the age of the youngest homeowner.

Since no interest is paid by the borrowers, interest accrues on the note each month, but is not collected until after the death (or permanent vacancy) of the all borrowers on the note. Lenders assume the risk that the loan balance might become greater than the value of the home. Borrowers retain ownership of the home and can sell the home or refinance the loan to a regular loan later if they choose. Reverse mortgages can also be refinanced later on with a new reverse mortgage to pull out more equity if the home value increases substantially.

Getting rid of monthly mortgage payments and using the nest egg built up over the years can really ease the stress of retirement for seniors. Knowing that their home can never be taken away is also a great relief. The loan does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has 12 months (with no required payments) to refinance the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is passed on to the heirs.  If no equity remains in the home, the estate can simply walk away with no liability. The estate is not liable if the home sells for less than the balance of the reverse mortgage.

Purchase a Home with a Reverse Mortgage

Reverse mortgages can be used to purchase a home. For example, seniors that wish to downsize can sell their existing home, make a large down payment on a smaller home, and finance the rest with a reverse mortgage. Then, no payments will need to be made for life.

Call us today just to see how much money you can get.  

801-277-5100

Shame On Banks - Mortgages in Salt Lake City, UT

Mark's Credit Tips

As your source for creative mortgage financing, I've "done my homework" on credit and credit scoring. In doing so, I've found there are a lot of misconceptions out there about how credit scores are determined. I find quite often that well-intentioned people are doing things that will hurt their credit scores without knowing it. Many times they were told to do these things by someone in the mortgage or banking industry. Go figure.

I thought it would be beneficial to pass on what I have learned from the credit bureaus and to clarify some of the most common misconceptions about credit scores.

Here are the factors that affect credit scores in order of importance. The percentages shown are the extent that these items affect the score--or how much "weight they carry."

Payment History - 35% of what determines your score - DON'T BE LATE

1. 
   Public Record and collection items


2. 
   Recency, frequency, and Severity of delinquencies (in that order)

Outstanding Debt - 30% of what determines your score - DON'T MAX OUT

1. 
   Number of balances recently reported


2. 
   Average balance across all trade lines


3. 
   Relationship between total balances and total credit limit on revolving trade lines

Credit History - 15% of what determines your score - DON'T CLOSE CREDIT CARDS

1. 
   Age of oldest trade line


2. 
   Number of new trade lines

Pursuit of new credit - 10% of what determines your score - ONCE ESTABLISHED, LAY LOW

1. 
   Number of inquiries and new accounts opened in last year


2. 
   Amount of time since last inquiry

Types of credit in use - 10% of what determines your score - KEEP A GOOD MIX OF CREDIT

1. 
   The number of trade lines reported for each type:

• 
  Bank cards, travel/entertainment cards, dept. store cards


• 
  Personal finance company references ("Same as cash" NOT good)


• 
  Installment loans

The most shocking thing is that "paying on time" only accounts for 35 percent of what determines your score. Even if you always pay on time, you CAN still have VERY LOW SCORES if you're maxed out on everything, for example.

Hardly anyone realizes that 30 percent of what determines the score is how outstanding debt is managed. "Maxing out" credit cards is the biggest "no no." Maintain a low ratio (49% max suggested) of how much you owe in relation to how much your credit limit is. Request credit line increases or pay down balances to avoid a lower score due to being over extended.

• 
  NOTE: Even if you pay off the account on the next business cycle, there's a good chance the high balance will report before you do so. Then the damage is done.

Next, it's wrong to assume that scores will improve by closing accounts. People think that by having too many credit cards with high limits, their scores will be low due the risk of a "mad spending spree" that could cause them to get over-extended.

This is a fallacy.

Maintaining stability and control with large credit limits will help to produce very high scores. Closing accounts, on the other hand, will reduce the amount of credit available, which will make the person appear more "maxed out." KEEP ACCOUNTS OPEN!

Finally, credit inquiries and new credit lines can temporarily lower the score until those accounts are seasoned. Credit inquiries can affect credit scores for up to 1 year. People with very little credit must pass through this in order to get established. However, people with established credit should be careful about applying for and opening up a lot of new credit right before they apply for a home loan.

• 
  NOTE: If you need a loan, don't hesitate to have me run a credit report to assess your chances. The advice I can give you to improve your scores will make them go up way more than the few points they might lose by having an inquiry. For example, don't wait till your rental lease is up toget qualified. Get with me months before, so that if something needs to be fixed, you'll have time to do it.

Credit scores are very accurate in forecasting trends that lead to severe delinquency. People on the road to delinquency, tend to be over-extended, and to continually be in the pursuit of more credit. With most mortgage programs these days, the interest rates are driven by the credit scores, especially at high LTV (Loan to Value) ratios. However, I have additional programs that are still underwritten the "old fashion way," based on payment history alone without regard to credit scores for those who learn this too late.

Hopefully this information will be valuable to you. If you follow these rules, you'll improve your chances of obtaining the best loan programs available for your situation. Call me if you have any questions. TELL A FRIEND about this part of the site. You know you know several people who should read this. Call me for the best loans with high and low credit scores. Buy or refi with no $ down, and no income verification 801-808-6275.

Reverse Mortgages in Utah

Reverse Mortgages

“I’m retired and my income is low. I have a lot of equity in my home, but it does me no good unless I sell the house. But I need a place to live! I wish there was a way to stay in my home and stop making mortgage payments. I would love to get at some of that equity to pay for prescriptions, medical costs and spoiling my grandchildren. Can’t the lender just let the interest build up on my loan and collect it later after I die? Right now I need a break!"

Home Equity Conversion Mortgages (HECMs), commonly known as reverse mortgages, are Federal Housing Administration insured low-interest home loans for seniors (over 62 yrs) that require no payments EVER as long as the seniors live in the home. Existing loans can be paid off and equity can be drawn out to pay for medical expenses, living expenses, or whatever the borrower chooses. The maximum loan amount is a percentage of the home's value determined by the age of the youngest homeowner.

Since no interest is paid by the borrowers, interest accrues on the note each month, but is not collected until after the death (or permanent vacancy) of the all borrowers on the note. Lenders assume the risk that the loan balance might become greater than the value of the home. Borrowers retain ownership of the home and can sell the home or refinance the loan to a regular loan later if they choose. Reverse mortgages can also be refinanced later on with a new reverse mortgage to pull out more equity if the home value increases substantially.

Getting rid of monthly mortgage payments and using the nest egg built up over the years can really ease the stress of retirement for seniors. Knowing that their home can never be taken away is also a great relief. The loan does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has 12 months (with no required payments) to refinance the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is passed on to the heirs.  If no equity remains in the home, the estate can simply walk away with no liability. The estate is not liable if the home sells for less than the balance of the reverse mortgage.

Purchase a Home with a Reverse Mortgage

Reverse mortgages can be used to purchase a home. For example, seniors that wish to downsize can sell their existing home, make a large down payment on a smaller home, and finance the rest with a reverse mortgage. Then, no payments will need to be made for life.

Call us today just to see how much money you can get.  

801-277-5100

Visit us on our Website http://www.legendfinancialservices.com

Reverse Mortgages in Salt Lake City Utah

REVERSE MORTGAGE ELIGIBILITY

To be eligible for a reverse mortgage, the Federal Housing Administration (FHA) requires that all homeowners be at least age 62 and have sufficient equity in the home That’s IT! There are no income or credit requirements for a reverse mortgage. Borrowers can even be in foreclosure or bankruptcy and the reverse mortgage can pay off the existing loan.



Simply provide your Legend Financial Services loan consultant with your age(s), the approximate value of the home and the existing loan balance(s). Your loan consultant will let you know the approximate loan amount that you can get (subject to appraised value). Whatever amount exceeds your loan balance is yours to keep and can be taken as a lump sum, line of credit, or monthly payments to you.  If you don't have a mortgage, the entire amount of the loan is available for you to use.

BENEFITS OF A REVERSE MORTGAGE

What are some of the benefits of a reverse mortgage?

• 
  Strengthen your personal and financial independence.


• 
  Help pay for health care or other needs.


• 
  You can never lose your home in foreclosure as long as you maintain the property tax and insurance payments.


• 
  The loan is only paid off when the house is sold by you or your heirs, or all borrowers move out of the house.


• 
  Keep your Medicare or Social Security benefits.


• 
  Use it as a credit line and draw upon it as needed.


• 
  Get all your cash right away.


• 
  Get the best of both—get cash now and have a balance in reserve to use as a credit line.


• 
  No Income Requirements: The homeowner does not need to be working and is not qualified based on income.


• 
  Lock in your loan amount NOW before any more possible depreciation of your home's value.


• 
   

Reverse Mortgages in Utah - Learn what a Reverse Mortgage is

Reverse Mortgages in Utah - Learn what a Reverse Mortgage is

What are some of the benefits of a reverse mortgage?

• Strengthen your personal and financial independence.
• Help pay for health care or other needs.
• You can never lose your home in foreclosure as long as you maintain the property tax and insurance payments.
• The loan is only paid off when the house is sold by you or your heirs, or all borrowers move out of the house.
• Keep your Medicare or Social Security benefits.
• Use it as a credit line and draw upon it as needed.
• Get all your cash right away.
• Get the best of both—get cash now and have a balance in reserve to use as a credit line.
• No Income Requirements: The homeowner does not need to be working and is not qualified based on income.
• Lock in your loan amount NOW before any more possible depreciation of your home's value.