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aarp reverse mortgages

AARP sues HUD over Reverse Mortgages: What is a reverse mortgage ttp In this video, real estate attorney hugh Fitzpatrick from Tewksbury Massachusetts discusses the lawsuit ...

AARP Weighs in on the 'New' Reverse Mortgage Math

Lori Trawinski, director of banking and finance at AARP’s Public Policy Institute, declines to call the changes positive or negative, but does admit that higher costs might make the loan less attractive — and new principal limits might mean fewer seniors will qualify.

“If you have an existing forward mortgage, that mortgage needs to be paid off before you can get a reverse,” she says. “So if someone is counting on a certain amount of reverse mortgage proceeds to be able to pay off a forward loan, it could be that with the new principal limit factors, they may not get enough proceeds out of the loan to do that.”

Higher upfront costs might also be a disincentive to consumers, Trawinski says.

“For about three quarters of borrowers, the upfront premium went from 0.5% to 2%, so that’s a significant increase. It may dissuade some borrowers from going forward with the loan,” she says.

Amy Ford, NCOA’s senior director of home equity initiatives and social accountability, agrees that these factors might influence consumer decisions and says the changes highlight the need for effective counseling.

Washington Post Explores the Reverse Mortgage as Divorce Solution

“This is a very common problem throughout the country,” Kass wrote. “With the divorce rate increasing among seniors (the ‘silver’ divorce), too many couples seeking a divorce either have to sell the family home, or the spouse who will not remain in the property is unable to buy something else.”

The incidence of older Americans divorcing is indeed on the upswing: The breakup rate for married Americans aged 65 and older tripled between 1990 and 2015, according to a 2017 survey from the Pew Research Center.

Kass proposes a kind of “double reverse” solution for the fictional pair: The wife can take out a reverse mortgage on the property and receive about $286,000, with $200,000 going toward paying down the existing mortgage on the home — and the remaining $86,000 helping form the husband’s down payment on a Home Equity Conversion Mortgage for Purchase transaction on his new condo.

“If Sam and Sara both qualify for their HECM, Sara will stay in the family home, Sam will have his own condo, and neither will be obligated to pay any mortgage so long as they continue to reside in their respective properties,” Kass concludes.

Is Filing For Bankruptcy In Retirement A Good Thing?

The number of people filing for bankruptcy protection in retirement has soared in recent years — even before the recession.

Filing for bankruptcy would not include long term care since you have to pay monthly for assisted living or nursing care. You are correct that those are out of pocket costs unless you are on Medicaid.