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MBA Urges Regulators To Avoid Invoking Suitability Standards
The Mortgage Bankers Association (MBA) recently made a preemptive strike against what it obviously perceives as the next threat against the mortgage industry - "suitability standards." Read more...

 

Reverse Mortgage Information

Since your home is probably your largest investment, it is smart to know more about reverse mortgages, and decide if one is right for you. Reverse Mortgages are not for everyone, but everyone 62 years or older should know what exactly a reverse mortgage can do for them. Reverse mortgages are a special type of home loan that let a homeowner convert the equity in his/her home into cash. Reverse mortgages are even more complicated than conventional mortgages and consequences of various options are not always obvious up-front. Reverse mortgages have been seen as a way to help seniors who are asset rich but cash poor remain in their homes and cover medical bills, home upkeep and living costs.

Reverse mortgages differ from home equity loans in that most reverse mortgages do not require any repayment of principal, interest, or servicing fees as long as you remain to live in the home. A reverse mortgage interest rate is charged on the outstanding balance and added to the amount you owe each month. The reverse mortgage interest rate is not deductible on income tax returns until the loan is paid off in part or whole.

The reverse mortgage interest rate is determined on a program-by-program basis, but is typically similar to the reverse mortgage interest rate offered by Adjustable Rate Mortgages (ARMs). The reverse mortgage interest rate is usually higher than average home loan rates. As you consider a reverse mortgage, be aware of these: lenders generally charge origination fees and other closing costs for a reverse mortgage. Reverse mortgages generally charge loan-origination fees and closing costs. When you sell your home or no longer use it as your primary residence, you or your estate will repay the cash you received from the reverse mortgage, plus interest and other fees, to the lender.

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