Reverse mortgage myths debunked

Posted by on 4:37 pm in Connecticut Mortgages | 0 comments

Reverse mortgages are as widely misunderstood as the elusive Yeti. I am here to debunk these myths and give you the straight facts and uses for this loan. All mortgage loans should be used like tools, have them ready when you need them, and know how to use them when you need them. Reverse mortgages are no different in that they play an incredibly crucial and life saving role in our society. A reverse mortgage is a government insured loan available to any senior who is 62 and over and lives in the house as their primary residence. The first myth is that you no longer own the home after you close on a reverse…this is still hold title to the home with a first mortgage lien on it just like when you bought it. The second myth is that if you miss a payment the government seizes the house and kicks you out…INCORRECT.. Their are no principal or interest payments required on a reverse mortgage, the borrower is obligated to pay taxes and insurance on the property. Yes, that was correct, their are no payment requirements as far as principal and interest on a reverse mortgage Ever as long as certain conditions are met. Condition one is that you must reside in the home as your primary residence, and condition two is that you keep the taxes and insurance curre The money used in a reverse mortgage can be used for anything the homeowner wants or needs and the loan amount is a moving target and is based on the borrowers age, property value, and property condition. Currently there are no income or credit minimums to meet to obtain the loan, but in January of 2014 the government may have certain specific standards for the borrower to meet to obtain the loan. The best thing you can do is call a qualified reverse mortgage specialist such as myself to find out your options, what you can qualify for, and what your options...

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Refinancing to pay off debt

Posted by on 10:47 pm in Connecticut Mortgages, Loan Programs, Uncategorized | 0 comments

Also known as cash out refinancing can be an incredibly powerful tool to a homeowner. The most asked question by clients is should I pay off credit card and car loans with the equity in my house. There are a lot if different answers to this question but if you take out the emotional side of things typically the answer is yes. The average credit card rates are around 13% and that’s for the ideal card holder and in the area of 23% for the rest of the people. With that being said you have to compare apples to apples and add up all of your current monthly debt and compare them to the new mortgage payment after using a mortgage to pay these off. The rule of thumb I like to use is that if the savings is over $250 per month and you aren’t adding too many years to your mortgage than your answer is “YOU HAVE TO REFINANCE” Typically people pay near minimums on their credit cards and by doing this it turns into a 25 year debt anyway at an average rate of 18% your loosing tens of thousands by not refinancing. Take the savings and reapply it to the new mortgage and before you know it your principal balance on your mortgage is shrinking a lot faster than you...

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New Mortgage Rules for 2014: Qualified Mortgage Rule

Posted by on 4:01 pm in Connecticut Mortgages | 0 comments

Qualified Mortgage Rule Redefines Mortgages   If you have not heard yet there will be a new phase of the Dodd Frank Bill coming into play in the middle of January 2014 and it will redefine what a mortgage will be in the future. It’s called the Qualified Mortgage Rule and it is a black and white definition of rules needed to write new conforming mortgage loans and refinances. Currently if a borrower has excellent credit, appropriate assets, and proper work history and have a higher than industry standards debt to income ratio less than 50% than you have a good chance of getting approved. With the new phase coming into play you will no longer be able to go over a ratio of 43% back end debt ratio on a conventional mortgage. This will change the way loans are underwritten and make it even tougher to qualify for that mortgage. There are two schools of thought to this, the first is that it makes sense to limit exposure to Fannie and Freddie and standardizes the process a bit better. The second school of thought says that if a borrower meets all of the criteria of being a responsible individual by paying all of your bills on time, keeping a consistent work history, and saving appropriately than why can’t this perfectly competent adult make this decision on their own.   If you happen to be one of these borrowers or if your client is one of these borrowers than what do you do? First, breathe, than call a mortgage professional such as myself to go over the options that are available to you. In the age of information that we live in there is correct and incorrect information about this flying everywhere, don’t panic, pick up the phone and reach out to the people who do this for a...

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