News by Subject
Complete list of specialty news sections.

Mortgage Advertising
Reach mortgage executives, loan originators and other people tied to mortgage industry.

Mortgage Industry News
Subscription-based news for people who work in real estate finance.

Mortgage Newsletter
Free e-mail newsletter with the latest headlines from

Mortgage News Reprints
Put entire stories in your online or printed newsletter or publication.

Mortgage Feedget RSS code
Condensed stories for your web site or for your RSS reader.

News Archives
Archive of news entries.

Mortgage Statistics
Data and statistics for real estate finance.

Mortgage Graphs
Directory of lenders, branch operators and mortgage service providers.
home advertise email RSS about us
HOT Topics Rates Glossary LO License Search
Consumer Mortgage News
Free mortgage news for current and prospective borrowers from a leading online mortgage industry news publication.

A Little Insight About Reverse Mortgages

The ins and outs of reverse mortgages

Sept. 22, 2015

By CAROL THOMPSON The Record-Eagle - Tribune News Service

TRAVERSE CITY, Michigan -- It's unlikely the costs of food, heat and medical care will remain unchanged after retirement.

That can provide difficulty when making ends meet, said Kathy Conley, a housing specialist with Greenpath Debt Solutions.

"When you get to be on a fixed income, your income's not increasing with the level of inflation," she said. "Basic needs are increasing in price while your income is staying the same."

Conley spends her days helping clients consider applying for reverse mortgages, loans often sought as a way to stretch a fixed income.

Reverse mortgages are loans that allow a homeowner to turn some of her or his home value into cash, either as monthly payments or in a line of credit. Qualifying borrowers for most loans must be 62 or older, live in their homes, own the homes outright or have a low mortgage payment. Borrowers must pay taxes and insurance in order to keep the home after taking out a reverse mortgage loan.

Payments depend on the borrower's age, current interest rate and home's value. Loans and interest are repaid when the borrower moves, sells the home or dies.

There are three types of reverse mortgages: Single-purpose reverse mortgages, typically loaned by state and local government agencies or nonprofits; Proprietary reverse mortgages, private loans typically targeted at high-value homes; and Home Equity Conversion Mortgages, federally insured loans backed by the Department of Housing and Urban Development.

Lisa Haggai is a certified reverse mortgage specialist with The Reverse Mortgage Center in Traverse City. She said reverse mortgages have gained popularity during her 17 years in the industry. She credits the shift to increasing education.

She said people who own homes of all values -- from those worth thousands to millions of dollars -- seek reverse mortgages.

There are still misconceptions about the loans, Haggai said. One is that mortgage companies take away borrowers' homes. That doesn't happen as long as borrowers keep up their end of the deal and pay property taxes and insurance. Borrowers still own their homes and can sell them. They just have to pay off debts and interest after a sale. Most reverse mortgages have clauses guaranteeing borrowers never have to pay more than the value of their homes.

Reverse mortgages aren't right for everyone. Haggai said people who want to pass their homes to their heirs should avoid reverse mortgages, since they have to be paid off when homeowners move, sell their homes or die. Heirs would either have to pay back the loan or qualify for their own mortgage to keep the house.

Reverse mortgages can also carry a lot of fees, said reverse mortgage consultant Vince Halek, of First Financial Reverse. Lenders can charge origination fees up to 2 percent, or as low as zero.

&You need to shop the fees," he said. "That's the number one thing."

Clients considering reverse mortgages should look out for signs that could point to possible scams.

Greenpath, 3210 Racquet Club Drive in Traverse City, is a listed as HUD's local reverse mortgage counselor. Conley said counselors can't give loans, just provide information.

"I honestly believe that there's always a danger of a scam, because scammers are really adaptable and change quickly to take advantage of anything they can," Conley said. "That's what they do."

Conley identified some red flags for those seeking reverse mortgages.

Lenders can't participate in counseling sessions, and they shouldn't ask. Clients should beware lenders who insist on being part of counseling sessions.

Clients should also beware pressure from friends or family members demanding a homeowner get a reverse mortgage.

"It needs to be the homeowner's decision," Conley said.

Learn more about reverse mortgages by visiting Find HECM counselors by calling 800.569.4287.

next story

back to home page

To see more of The Record-Eagle or to subscribe to the newspaper, go to

Copyright (c) 2015, The Record-Eagle, Traverse City, Michigan

Distributed by Tribune News Service.

This story was distributed by TNS - Tribune News Service
Refinance News
News about refinance programs, pricing and production.
H A R P 2.0 News
News stories about the H o m e Affordable Refinance Program including expanded program guidelines.

Copyright © 2016 Subsribers Only:

AMC directory

ARM indexes

mortgage company directory

mortgage regulations

net branch directory

pricing engine directory

wholesale lender directory

More Mortgage News Resources ( full site map):

advertising news

appraisal news

bank news

biggest lenders

commercial mortgage news

corporate mortgage news

credit news

FHA news

financial regulation news

foreclosure news

free mortgage news

GSE news

jumbo mortgage news

interest rates

loan modification news

loan originator survey

LOS Newsletter


mortgage associations

mortgage-backed securities

mortgage books

mortgage brokers

mortgage compliance

mortgage conferences

mortgage directories

mortgage education

mortgage employment

mortgage employment index

mortgage executives

mortgage fraud

mortgage fraud blog

mortgage fraud local news

Mortgage Fraud Index

Mortgage Graveyard

mortgage insurance news

mortgage lawsuits

mortgage leads

mortgage lender ranking

mortgage licenses

mortgage litigation

Mortgage Litigation Index

Mortgage Market Index

mortgage mergers

mortgage news

mortgage politics

mortgage press releases

mortgage production

mortgage public relations

mortgage rates

mortgage servicing

mortgage statistics

mortgage technology

mortgage video

mortgage Webinars

net branch

net branch directory

nonprime news

origination news

originator tools

refinance news

reverse mortgage news

sales blog

secondary marketing

servicing news

subprime news

wholesale lenders

wireless mortgage news