Reverse mortgage vs. remortgage! how popular is a reverse mortgage?
Answers:
It's only available if you are over 65. With a reverse mortgage, the mortgage company advances you an agreed sum of money. No payments are made. When you die, they settle the mortgage next to the estate. If the balance is short, the mortgage company eats the loss. If here is any excess, it generally goes to the estate though some do provide for full title to go beyond to the mortgage company.
Actually reverse mortgages are for senior homeowners age 62 and over.
How popular is a reverse mortgage?
Reverse mortgages are still a niche market in the mortgage industry but they are growing surrounded by popularity as baby-boomers enter retirement, often with litle stash other than their home equity.
The HUD/FHA Home Equity Conversion Mortgage (HECM) is the most common form of reverse mortgage. It is geared for homes valued below $400,000. Less than 300,000 HECMs have been originate since the program started in 1989, but in recent months the gait has picked up to about 10,000 per month. Through the first 5 months of 2007, 47,511 HECMs be originated.
There are private reverse mortgages too. These are usually geared toward higher pro homes.
Reverse mortgages have huge growth potential, but they currently are still a tiny fraction of the overall mortgage industry.
California and Florida are the leading market for reverse mortgage largely because these markets (until the last 6 months or so) hold seen such tremendous home value growth. Here's a chart showing the most popular market for HECM reverse mortgages:
http://www.reverse-mortgage-information.org/top-reverse-mortgage-markets/ Source(s): http://www.reverse-mortgage-information.org/
Related Questions: