Shock value headlines a problem for Reverse Mortgage Industry
Reverse Mortgage Daily, an internet news agency and industry leader in disseminating information on Reverse Mortgages recently posted an article about Financial Fraud click to read. The data was supplied by the Retirement Research Center at Boston College reporting a 62% increase in complaints between 2001 and 2011
Complaints are not fraud. While I believe the numbers are accurate we need to look at the time period we are evaluating. We have experienced the largest economic downturn in our lifetimes during this timeframe. Are the complaints of “fraud” truly fraud or, merely the expression of frustration by seniors as they watched the value of their retirement assets and homes diminish at a time they were expecting to use them.
These types of dramatic headlines are eye-catching but dangerous. They create fear and misunderstanding and they present honest and responsible financial professionals in a bad light. While I do believe fraud should be prosecuted, let us not confuse a complaint with fraud.
5 Facts about Reverse Mortgages, That You Should Know.
There are a lot of myths and half-truths about Reverse Mortgages, so before dismissing a reverse mortgage as an option, talk to a Reverse Mortgage Specialist to get the facts and to see if a reverse mortgage is right for you.
1) Costs for doing a reverse are comparable to a conventional mortgage…even though you always hear they are high cost. Since this is a FHA insured loan , the difference is the cost of the Mortgage Insurance Premium. All fees are regulated and only HUD allowed fees are permitted with no mark-ups or junk fees.
2) Social security and Medicare are NOT affected if you take out cash from a Reverse Mortgage, because it is a loan so the IRS does not consider the proceeds income.
3) The Lender or bank does NOT own your home..You OWN the home and are on title.
4) There are no monthly mortgage payments , however you still must pay your taxes and insurance.
5) A reverse is a non-recourse loan. This means the borrower or heirs are not responsible for any difference if the home is sold for less than what is owed. Borrowers are NOT leaving debt to their children.
To talk to a Reveres Mortgage Specialist at MSI Reverse call 855 901 3100
Do you know the difference between Medicare and Medicaid?
According to Wikipedia the online dictionary below are the definitions of Medicare and Medicaid. Many seniors believe that these two medical payment systems are all they need for healthcare without every really understanding what they do or how they work. The financial consequences of understanding how and when each of these apply can make a huge difference in a persons quality of life and/or care, it pays to know these differences.
Medicare is a social insurance program administered by the United States government, providing health insurance coverage to people who are aged 65 and over; to those who are under 65 and are permanently physically disabled or who have a congenital physical disability; or to those who meet other special criteria like the End Stage Reneal Disease program (ESRD).
Medicaid is the United States health program for certain people and families with low incomes and resources. It is a means-tested program that is jointly funded by the state and federal governments, and is managed by the states.[1] People served by Medicaid are U.S. citizens or legal permanent residents, including low-income adults, their children, and people with certain disabilities. Poverty alone does not necessarily qualify someone for Medicaid. Medicaid is the largest source of funding for medical and health-related services for people with limited income in the United States.
Medicaid is basically charity, and while it serves a function of assistance in society there are strict rules and regulations for qualifying. If you are concerned or interested I suggest speaking to a certified elder law attorney or one the specializes in wills, trusts or succession planning.
If you need a referral or are an attorney wishing to be referred you may contact me at crizzo@msiloans.biz
Value in having an experienced reverse mortgage loan officer
Just recently at a closing the notary paid me a wonderful compliment. She told my customers they ”were very fortunate that their loan officer (me) was there to explain all of the documents they were signing” and that “most loan officers don’t even show up at the closing”. She also stated that she is instructed “not to try to interpret the documents, just make sure everything is signed properly so that the loan funds”. This is good business advice for the title company as a notary is not a mortgage professional and could create liability for the title company by saying the wrong thing. Not really a good option for the new reverse mortgage customer.
Reverse mortgages are much different from forward mortgages by design. If you are considering a reverse mortgage two of the things that should be evaluated are the competency of the loan originator and the level of service you will receive. Is the originator knowledgeable, do they take time to make sure you understand what a reverse mortgage is and how it works? Feeling comfortable with your decisions means starting with good information, don’t be afraid to ask about experience and service.
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About MSI
Mortgage Services III's Reverse Mortgage Specialists are here to work for your best interests! Contact us today to see if a Reverse Mortgage is right for you! MSI is headquartered in Bloomington, IL with multiple offices in the Metro Chicago area. 