No, I am not going to go ‘Robert Wagner’ here and spout off about how reverse mortgages are the greatest thing since sliced bread. I’m just going to tell you a story. 
When I worked for another lender, probably about 4 years ago now, we had a ’sales meeting’ a certain lender had their salesperson come in and talk to us about selling reverse mortgages. It seemed that the greatest thing about the reverse mortgage program was HOW MUCH MONEY WE COULD MAKE. Now, I always get a little skeptical about anything that’s first and most discussed reason for it’s existence is how much money someone can make by selling it. What’s in it for the consumer? Why does anyone need a reverse mortgage? What are the benefits and drawbacks? No one seemed to ask these questions, they were too blinded by the dollar signs gleaming out from the bank rep’s shiny white teeth!
On my own, I figured out ONE situation where it would benefit tremendously.
During the meeting, they had discussed the fact that credit scores are NOT taken into account (after all, the agency providing the loan is PAYING OUT the money, not expecting payment), and that the homeowner can be in foreclosure due to missed mortgage payments, or even tax bills.
“Whoa, back up. You can get a reverse mortgage if you are 90 days late on your mortgage and have a 465 middle credit score?”
Yes, indeed you can. Provided you have LOTS of equity in the property, and are over the age of 62.
If someone needs money to pay for their living expenses, and has plenty of equity in their home, it may be wise to discuss the opportunity a reverse mortgage offers.
It’s very easy to get started- in fact, the lenders that offer these programs ask for your age, your property zip code, your loan balance, and what you think the home is worth. That’s it, very simple.
To learn more about the Reverse Mortgage, visit HUD’s website- http://www.hud.gov/offices/hsg/sfh/hecm/rmtopten.cfm
Thanks for reading.
Jennifer Monastero
Citizens Community Bank
Last 5 posts in Credit Scores/Bad Credit
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- Categories: Credit Scores/Bad Credit, Mortgage Types
