Rose asked:


You have toiled hard in your younger days and now that you are bound for retirement, you might think there are no other ways to earn money aside from your retirement fees. This is often a common predicament among senior citizens who are retired from their employment but still want to be more productive as long as finances are concerned.

Reverse mortgage for home purchase is a government-insured mortgage loan given to qualified applicants in order to give financial assistance in terms of home purchase and investment in real estate. Furthermore, this outstanding mortgage loan has certain twists that you can never find in usual mortgage types and categories.

First and foremost, one of the most uniquely beneficial features of reverse mortgage is that borrowers are not obliged to pay their monthly dues unlike the usual trend in home mortgage. In fact, they are the ones to receive payment in forms of tax-free income which they have the freedom to use in other purposes and ventures.

How to qualify for reverse mortgage?

Those who wish to acquire reverse mortgage loans will not experience the same tedious requirements that most mortgage plans imposed on their applicants such as credit reports and the like. There are basic things that applicants for reverse mortgage must comply with in order to be eligible for the loan.

First is that applicants must be from 62 years old and above as this mortgage plan is made to cater especially for seniors and retirees. The types of housing units are likewise listed under the scope of reverse mortgage which actually gives borrowers the luxury of choosing among a wide range of houses from single-detached residences, multi-unit houses, single unit in a multi-unit building, townhomes and condo units among others. This is a great opportunity for seniors to make their own preferences and choose what kind of dwelling place they wish to enjoy as a reward for all their hard-work.

Another requirement to be eligible for reverse mortgage is that any residential units or properties purchased through this type of loan must only be made primary residences and not as vacation homes or rental units. Basically, borrowers are already granted financial assistance through non-payment of monthly mortgage dues and they even receive monetary incomes for the said loans, thus in terms of economical reasons for their purchase, they are actually receiving a lot.

In terms of occupancy, borrowers are required to stay and remain in the residential unit they purchased using this loan program within 60 days of closing and onwards. Their benefits and incentives are granted provided that they occupy the residence. For those who decide to leave the premise or the property, they would have to pay for the dues incurred during the process of acquiring the reverse mortgage home loan and the acquisition of the residence as well.

The federal government has indeed created a remarkable regulation through reverse mortgage that ensures not only income-generating options for seniors but also provides them the chance to purchase their dream home to enjoy the fruits of their labor.



LUIS

Jim Johnson asked:


For most people the mortgage industry seems to speak a foreign language, with terms and acronyms that are vague and unfamiliar. And of course, when dealing with large sums of money such as those found in a home mortgage, you want to try to understand the language as much as possible in order to avoid making mistakes. So here is a little primer on some of the most important terms used when getting a mortgage or home loan.

There are four types of mortgages that are generally available and those are fixed rate, adjustable rate, convertible and special loans.

Fixed Rate Loans – usually these are found in either the 30 year loan or 15 year loan category, and this simply means that you pay a fixed payment each month over the course of either the 30 years or 15 years.

Adjustable Rate Loans – this is where your payment can fluctuate depending on the prevailing interest rate at the time. If interest rates rise, then your payment goes up and if interest rates fall, your payment goes down instead.

Convertible Loans – these are loans that may start out as either a fixed rate or an adjustable rate mortgage, and then can be converted over to the opposite kind of loan instead. Many people will use this type of loan to start out as an adjustable rate mortgage and then convert over to a fixed rate mortgage when interest rates are at their lowest.

Special Loans – these include FHA loans for first-time homebuyers and folks with credit problems, and also VA mortgage loans for veterans of the Armed Forces and their families.

There are other terms that you need to know when it comes to getting a home mortgage as well and they are:

Appraisal – this is where you pay an independent person to correctly assess the value of your home using excepted market calculations.

Closing costs – these are fees that are usually payable when the mortgage papers are signed that pays for the transfer of the ownership of the home.

Points – this is a value that typically relates to 1% of the total cost of the home being mortgaged.

Escrow – this is where money is often held by a neutral third party in a transaction of two or more people.

Pre-qualify – this is where a lending institution will state that you do qualify for receiving a home mortgage for a certain price range of home.

Pre-approval – this is where a lending institution has already run the necessary paperwork and approved a home mortgage loan for a certain amount.

There are other special terms and acronyms used by the mortgage industry, but the ones listed above are perhaps the ones that are most commonly used. Hopefully this will help you be more informed when you try to get your next home mortgage loan.



FORREST

Steven Cancel asked:


It has never been a better time to consider getting a home loan with rates at historic lows and home prices softening. Purchasing a home is often the biggest investment one will make within their lifetime. Prior to purchasing a home there are many things to consider. You will want to have goals in place that support your decision and loan type. Different loan types can cater to your current and future financial needs. Always understand that mortgage companies understand that your needs and future expectations change. At any point you’re within your loan you can refinance and adjust your loan type and length but this often includes fees and charges that can be avoided by not changing the terms of your loan.

The first step one should take in consult with a seasoned loan professional. This would include a mortgage broker or loan officer that has been originating mortgages for a long period of time. It is not wise to make such a large investment with someone who is not familiar with each aspect of the industry. Create a list of questions that you have prior to contacting the professional so they will get a good feel of what your goals and expectations are. Be prepared for a credit check and be able to provide up to 2 years of income documentation. Your loan specialist will then provide you with an amount you will be able to get approved for along with what the expected monthly payment will be should you decide to take a loan out for the given amount.

If your goal is to purchase a home to live in it for at least 30 years it is best to get a 30 year fixed mortgage. This will allow your new home to be fully paid off over a 30 year period. After 30 years you will only have the loan paid off but you will also have equity that was obtained. Over the history of the real estate industry, housing pricing has shown incredible returns for their owners. Many other options are also available such as lower fixed periods, ARM, and jumbo loans. Your mortgage professional will best fit you with your loan type.

As a consumer it is also important that you trust your loan professional. Should you decide purchasing a home is the right path for your future you should make sure that the origination process is completed in a reasonable manner? Loan professionals are paid on what is known on the industry as points. Each point is a percentage on the actual amount being provided from the lender. These points can be clearly stated on the loan forms but also can be included in the actual rate you are being provided. Ensure you are aware of all the charges you acquiring to prevent from being over charged by a loan professional.



ALLAN