QUESTIONS?

CALL US: 703-319-2198


How to Determine if a Reverse Mortgage is right for you.

Published on Apr 25, 2016 | Reverse Mortgage Retirement Planning supplemental retirement income HECM Reverse Mortgage Financial Assessments Seniors LESA Retirement security

I would like to comment on this Washington Post article to put aside the guess work and focus directly on what a reader or potential homeowner should realistically expect from a reverse mortgage given this situation.  Here's the facts.  The problem cited was that the homeowner has fallen behind on their property taxes.  This occurrence within the past two years will trigger a LESA.  This is an automatic escrow or otherwise termed “life expectancy set aside” for applicable real estate taxes and insurance.  This will consume a significant portion of the otherwise available principle limit depending on age.  The older the homeowner, the more equity access; so age would play a critical role given a secondary objective of supplementing income.  Regardless, a reverse mortgage in this situation would provide stability because the LESA would provide the required funds to pay the real estate taxes as due and keep the home insured.  This would allow the homeowner to stay in their home.  Yes, selling is always and option but then you have to ask which is the lesser of the two evils when someone is in a distressed situation. No one likes getting a restricted approval with a reverse mortgage that requires a LESA, but living in a home and solving the money problems versus selling and having to come up with a new plan in unfamiliar territory, you have to ask yourself which makes the most sense.  In this scenario, I would vote for the government insured HECM reverse mortgage as the solution that would allow the homeowner to stay in their home until the end of their natural life.  This assurance does not come with selling.  

For further information on the affects of the Financial Assessments and LESA, feel free to read my previous reverse mortgage blogs.

https://www.jeffersonreversemortgage.com/blog/5960/retirement-planning/are-you-eligible-for-a-reverse-mortgage

https://www.jeffersonreversemortgage.com/blog/5755/retirement-planning/the-state-of-the-lesa---hecm-reverse-mortgages


George H. Omilan
President-CEO - NMLS# 873983
Jefferson Mortgage Group LLC
Located in Northern Virginia. Helping seniors with Reverse Mortgages in Virginia, Maryland, DC and Pennsylvania.

Questions/Comments encouraged.

 

Recent Posts

Blog Tags

Reverse Mortgage HECM Reverse Mortgage Retirement Planning supplemental retirement income Seniors Retirement security Financial Planning Short Sales Age in Place Traditional Mortgage Home Care Government insured mortgage lifetime income with a Reverse Retirement income insecurity HECM for Purchase solutions for underwater properties home equity access Long Term Care Jumbo Reverse Mortgage reverse credit line Social Security Financial Assessments Annuity forgiven mortgage debt mortgage Inflation Mortgage Loan Process Eligibility for Reverse Mortgage Specialized Forward Mortgages mortgage debt forgiveness act foreclosure cashflow FHA Debt Mitigation 55+ Loan modification Investor Loans Real Estate Investment Loans self-employed borrower VA LOAN HUD private label reverse mortgage Non QM Reverse to Purchase Mortgage Housing Market investor financing No Doc Investor Loans Real Estate Market VA Low Score Jefferson Mortgage Group bank statement loan Interest Rates QM HECM Changes High-Value Homes LESA Mortgage Rates Medicare Sandwich Generation Hard Money Loan Lending Limit increase DSCR 2025 changes modify your loan with your lender mortgage debt relief act Mortgage Deliquency Non-recourse loan Business Cash-flow Fiscal Cliff HECM to Purchase Senior Advocate mortgage debt Reverse Mortgage Eligibility Low Credit Score manual underwrite Construction Loan Fed Real Estate Economy 2023 changes growth factor downsizing HELOC success story Trump Principal Limit Factor 2021 Changes Debt Treasury Commercial Real Estate FINRA Housing Prices Property-based loan occupancy requirements Asset Qualifer ATR Rule assisted living LLC Asset Based Mortgage Blanket Loan Seller Contribution Jumbo Reverse Second Trust Diversification Estate Plan Senior Care Rentership Credit Score down to 500 Second Trust Gray Divorce Jumbo Mortgage Loan Unrestricted Approval bankruptcy MIP Second Trust Prequalification Non-Qualifying Loan