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jerry
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Joined: 17 Oct 2005
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Location: MICHIGAN
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Hi Carol,
It will be very difficult to get a reverse mortgage on a 1974 mobile home. Such old homes do not qualify for any type of loans as they are not in compliance with the safety regulations and depreciate very fast. But still if you want, you can go for a no-obligation free mortgage consultation with the community lenders and see if the home can qualify for a reverse mortgage.
Thanks,
Jerry |
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anonymous ???
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Post subject: need wisdom about reverse mortgage |
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mother 85 owes around 14,000 . house needes lots of repares- ?? she moved to out of state and cut off part D . only plan has donute hole and she needs to pay cash for med. $700.+ per mo.
don't know if the reverse m. good idea or not, i was told she might get enough equity back to pay for meds till able to find other med help? House is couse of med problem cost! then i saw that childeren would be left to pay back mortgage when mom passes and would not be able to do that could house just go back to bank ? Help!!! Please need wisdom.
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savior70
Joined: 25 Mar 2009
Posts: 1412
Location: Florida
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Hi
| Quote: | | i saw that childeren would be left to pay back mortgage when mom passes and would not be able to do that could house just go back to bank ? |
A reverse mortgage will surely be a good idea as it will help your mother to pay for the monthly medical expenses. As far as the repayment of the reverse mortgage is concerned, the children will not have to pay it off. After you mother dies or she sells the house, the property will be taken over by the lender and will be sold to satisfy the reverse mortgage balance. If there's any excess money after paying off the loan, it will be given to her children. |
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Raymond Denton
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>>If there's any excess money after paying off the loan, it will be given to her children.
That's not correct. If the bank sold the home, that means the children allowed it to go into foreclosure and the bank keeps everything. If there's equity in the home when the loan is due, and the children want it, they're the ones that need to sell the house. Upon sale, they'll pay the Lender what's owed them and keep the retained equity for themselves. |
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raymond
Community Experts
Joined: 03 Jul 2009
Posts: 313
Location: Irvine, CA
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>>In other words, will you finance the $100,000 and give me a reverse mortgage for the $150,000 extra?
When the purchase program first became available, the answer was "yes". But HUD revised the Mortgagee Letter and now the answer is "no".
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Raymond
www.ReverseMortgageCalculator.org |
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raymond
Community Experts
Joined: 03 Jul 2009
Posts: 313
Location: Irvine, CA
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>>If we get another type of loan to get her a small house or a new trailer, could we say a month or two later get a reverse mortgage?
Yes, but you'd save money if you purchased it with a Reverse Mortgage. HECM's received purchase capability January 1, 2009.
>>Any stipulations on the time that she has to have lived in that new home?
HUD doesn't have seasoning guidelines (yet), but the Lenders do, and most lenders have 12 months. For several years there weren't any seasoning requirements, but bad guys started flipping homes with Reverse Mortgages, so the Lenders had to impose "investor overlays" and now we have seasoning requirements. However, you situation is different and if you're going to do it that way, get it pre-approved with the Lender first and get their blessing first.
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Raymond
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raymond
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Location: Irvine, CA
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>>we have a double wide 1974 on 1 arce permanent foundation paid forwe need reverse mortgage
It can't be done. HUD says only manufactured homes with a tag of June 15, 1976, or later is eligible, and nobody is flexible in that area.
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Raymond
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raymond
Community Experts
Joined: 03 Jul 2009
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Location: Irvine, CA
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>>I have also been told that since there is the MIP insurance that the house should be ours free and clear. Is this true?
No. The insurance protects the lender in case the benefits received by the homeowner are greater then the value of the house, and protects the homeowner in case the Lender goes under.
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Raymond
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raymond
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Location: Irvine, CA
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>>Is it possible to get a "temporary" reverse mortgage and pay it back within a couple of years?
Yes, but not financially wise (at least with the HECM, the FHA-insured program). The fees are simply too high. 18 months ago you could get a proprietary Reverse Mortgage that didn't have any fees at all, and those programs went away and won't be back for a while.
I've had one homeowner do a HECM for only 6 months, but it was the only option they had left. They would have went under otherwise.
I've helped several homeowners build brand new homes and then I'd take it out with a Reverse Mortgage. They'd get a bridge/construction loan and I'd take it out with a HECM. So that's a potential solution that may work.
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Raymond
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raymond
Community Experts
Joined: 03 Jul 2009
Posts: 313
Location: Irvine, CA
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>>she moved to out of state and cut off part D . only plan has donute hole and she needs to pay cash for med. $700.+ per mo.
It sounds like your Mom would be better off with Medicares Advantage program (part C). If she used to have part D, that means she probably has part A and B too, and that can get really expensive, especially if she hasn't purchased Medigap insurance. Part C includes EVERYTHING in parts A, B and D and even Vision and Dental with some programs. www.medicare.gov offers a form you can complete and it'll show you all the Advantage programs being offered, enabling you to select a program that fits Mom best.
A Reverse Mortgage is definately something you should look into for her. Her quality of life will improve if she can increase her cashflow and reduce her medical premiums and expenses.
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Raymond
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raymond
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Location: Irvine, CA
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>>they are thinking of gifting cash to their children and grandchildren from their reverse mortgage funds. At their age they may have to go to a nursing home any time, so if they need medical help, how will they pay; I don't want them to be penalized for having not paid for the Medicaid money. Is gifting from a reverse mortgage handled in a different way compared to any other asset?
Yes, chances are very good the gifts will impact Medicaid benefits, if they need to use Medicaid for Long Term Care purposes. There's a 5 year lookback and the government is very strict about where the money has gone during that period, and your parents will be penalized if they provide a large cash gift to the grandchildren. However, providing a lot of small cash gifts may be okay. First, they should seek the advise of an Estate Planning Attorney that understands Reverse Mortgages. Second, they should research purchasing private Long Term Care insurance. They won't have to worry about Medicaid if they have their own private policies.
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Raymond
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raymond
Community Experts
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Posts: 313
Location: Irvine, CA
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>>If my father gets a reverse mortgage will he loose his social security.
No. Social Security isn't impacted by a Reverse Mortgage.
>>I am talking the lump sum kind. He he get's 100,000 let's say does he have to spend it all at once?
No. It's his money to do with as he wishes and it's non-taxable. Lets hope he puts it away in a safe place that'll continue to work for him. Watch out for those Annuity salespeople - they'll be all over your Dad once they find out his cash position. Not to say an Annuity is a bad idea, it's just that the Annuity Salespeople are selling Reverse Mortgage recipients "deferred" annuities instead of "immediate" annuties. They do that because a deferred program pays them 6-15% and the immediate program only pays 1-3%. A SPIA (single premium immediate annuity) behaves very similarly to the monthly payment program provided by a Reverse Mortgage. I always ask my clients to read the most current edition of Annuties for Dummies if they're considering using the proceeds to purchase an annuity. And stay away from all salespeople until you've finished the book and are comfortable with the subject.
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Raymond
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raymond
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>>my parents are in the process of going trough with reverse mortgage but were told they don't get any money from the deal, why is that?
Because they don't have enough equity in their property. If they're still in the process and the loan hasn't funded, find out if they're getting a variable interest rate program or fixed interest rate program. If it's the variable program, chances are very good they'll get some cash back if they switched to the fixed interest rate program (the interest rate is 5.56% today). I've switched all my clients over to it because they receive significantly more cash.
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Raymond
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raymond
Community Experts
Joined: 03 Jul 2009
Posts: 313
Location: Irvine, CA
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>>What if I do not have much equity. Home is worth aprox $225 and we owe $195,000. What if we do not want to take any cash out, simply get the reverse mortgage and make small payments. Is this possible?
Yes, when a Reverse Mortgage is combined with a short-refinance. The Reverse Mortgage will pay off a large portion of the existing lien, and the existing lienholder would be in 3rd position (HUD sits in the 2nd position).
Your lienholder would have to agree with it though, and that's not easy. I'm doing two like that right now and they're taking a long time - I'd prefer not to do anymore.
Alternatively, you could contribute the shortfall yourself. 50% of my clients have shortfalls and they're contributing the amount they're short, so they can end their monthly mortgage payments.
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Raymond
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raymond
Community Experts
Joined: 03 Jul 2009
Posts: 313
Location: Irvine, CA
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>>how much does your house have to be to quality for a reverse mortgage
When you're in your 60's, you'll receive credit for approximately 50% of the value of your home. So you'd receive $50,000.00 from the Reverse Mortgage if your home is worth $100,000.00. The number increases as you grow older. I've done 3 Reverse Mortgage for homeowners in their 90's and all 3 times the number was the same - they converted 84% of the value of their home into cash.
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Raymond
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