The census showed that citizens age 65 and over constitute 13.4% of the U.S. population, a record high. This growth of the senior portion of the population is being called the largest demographic shift in history. Over the past decade, the senior population grew 15.1% nationwide, but grew 23.5% in the West, meaning that region is leading the demographic shift. California already is the state with the largest number of senior residents, with 4.2 million. It is estimated that by the year 2030, those 65+ will number 72 million and constitute almost 20% of the population.

Inside California, a good example of these changes to the population is San Diego. The median age of San Diegans is getting higher, and the continuing addition of baby boomers will strengthen this trend, where the senior population grows faster than other parts of the population. The census anticipates that from 2000 to 2030 the 60-plus crowd in San Diego county will grow by 130%, while the area’s general population will grow by only 38%.

The reverse mortgage is restricted to seniors age 62 and above, and its popularity has grown, just as the senior population itself has grown. President Ronald Reagan signed the reverse mortgage into law in February 1988, and its purpose was to let seniors have access to the equity in their homes without having to make payments on the loan. The loan allows the balance to grow over time in lieu of payments. This is the opposite, or “reverse” of a regular forward loan, which requires monthly payments and where the balance decreases month by month.

This program had a pretty slow start, as it took the lending industry a while to understand it and for the public in general to become aware of it. There were 6637 loans created in 2000, with a dollar volume of $827M. This grew to 114,641 loans in 2009, with a dollar volume of $30.2 billion. Understandable by demographics, California and Florida have been vying with each other for the most reverse mortgages originated each year, with California having a wide lead in the overall number of reverse mortgages originated.

But a large concentration of seniors is not the only reason a reverse mortgage (also known as a Home Equity Conversion Mortgage or HECM) may grow in a given region. Also important is the value of homes. The higher the value of the home, the more the borrower can receive, and thus the attraction of the program grows.

But there’s a limit to the value factor as well. The FHA will allow a maximum value of $625,500. The median value of homes in San Diego is about $300,000, which is far more attractive for this loan than the national median value of $125,000, but doesn’t go too high. San Diego is thus a prime location for HECMs. It participates in the West’s aging population and has “just right” home values for making a large impact on a borrower’s cash flow. It is fitting that the reverse volume of September 2011 in San Diego was an increase of more than 11% over that of September 2010.

For more complete advice about reverse mortgages, advice that is accurate and objective, you should visit the Reverse Mortgage Educator. This is also the place to get individual help with a San Diego reverse mortgage.

1. HECM Reverse Mortgage Is The Lowest Cost Multipurpose Loan.

What are the property requirements for HECM Reverse Mortgage Loan?

2. The Government Insured FHA Program.

hecm reverse mortgage What is HECM Reverse Mortgage? How much can you borrow from HECM Reverse Mortgage Loan?

The whole system has been built around the equity of the home. So if a senior is age 62 or over, owns a home, where he lives permanently, he or she will qualify. Altogether three seniors can be borrowers, but all must fulfil the qualifications. Most home types are accepted. The federal counselor can tell more about the details.

3. The Tax Free Loan.

The HECM reverse mortgage is a serious product, which is not meant to pay the Caribbean Cruise. Most seniors, who have taken it, use the money to pay the increased medical bills, to pay the home repair or to buy a home to a child. However, a senior can use the money as he will, there is no reporting.

4. The Credit Score And The Income Statement.

Let us go back to the basic idea of this loan. It was to arrange cash money to the seniors against the home equity and the deal includes also an obligatory mortgage insurance. This means, that the lenders are not interested about the incomes or the credit scores of the seniors, because they are useless in this context.

5. The Disadvantages.

On our next blog, I will be talking about how the HECM Reverse Mortgage Loan works and all the costs involved in getting a HECM Reverse Mortgage Loan.

Learn more about HECM Reverse Mortgage. Stop by Paul Hong’s site where you can find out all about Reverse Mortgage Loan and what it can do for you.. Unique version for reprint here: What is HECM Reverse Mortgage?.

How Reverse Mortgages Work

The amount you can borrow with a reverse mortgage is based upon three factors: your age, current interest rates and the appraised value of your home. You can choose to receive your reverse mortgage funds in a lump sum, monthly payments or you can open a line of credit to draw upon at your choosing. When you apply for a reverse mortgage, your lender will take an appraisal of your home and the amount you can borrow will be determined based upon this valuation. There is very little out of pocket expenses with reverse mortgages as you can finance most of the closing costs into the loan. The loan will not come due and no repayment will be required as long as you continue to reside in the home as your primary residence.

Control Your Retirement Budget More Carefully

As a senior, you know that it can be difficult to create a steady budget during retirement. Using the built in home equity from the house that you already own can allow you to create a budget that provides you with the comfort that you need. Once you have taken out a reverse mortgage, you are not required to withdraw any of those funds at any specific time. You can choose to use the funds as a sort of savings account to use in emergencies, or you can choose to pull all of the money out at once and pay off outstanding debt. The money is yours to do with as you see fit.

Increase your Monthly Income

Many seniors enjoy the flexibility and convenience of receiving their loan funds in monthly installments. Reverse mortgages can supplement your retirement plans, pensions and social security payments. Your reverse mortgage broker can explain all of these options to you and show you which plan is best to meet your retirement needs. The extra income a reverse mortgage can provide can mean the difference between struggling financially and enjoying your retirement years in Florida.

Live out Your Years in Florida Comfortably

Reverse mortgages truly reward those who have been thrifty in their early years and paid down their mortgages. During your retirement years, your home can truly pay you back in every sense of the word. Since reverse mortgages do not require repayment as long as you continue to live in your home, they allow you to truly enjoy your home without worrying about your monthly mortgage payments . Your home equity pays for itself in many ways. So, to truly enjoy your retirement years, make sure you find out how much a reverse mortgage can benefit you.

If you’re thinking of financing your home with a reverse mortage, check out Reverse123′s site on Reverse Mortgage Information and Florida Reverse Mortgage Lender

Did you know that with the fixed rate reverse mortgage loan you only get one option? It is to take all of your equity that is available in a lump sum. Knowing this will help you decide if this is the right choice for you. Some prior clients have used the lump sum disbursement in the following ways:

1. To pay off your current loan and the balance is high enough to leave you only a small amount of cash to be drawn.

2. You are considering doing a remodel or major repair to your home and this remodel uses up a majority of your available funds.

3. You are purchasing an expensive item like a car, a motorhome, or even a second home. Again this should consume most of your available equity draw.

4. By combining the above items you may be able to total most of your available draw.

The idea is, if you have a place to put (or spend) the money, it won’t be a burden to have it “sitting around”. You have to keep in mind that you are accruing interest on any money that is drawn or borrowed.

What should you do if you don’t want or need all the available equity right now? This is where the reverse mortgage with an adjustable rate comes into play.

You can get more information on a reverse mortgage loan or read other articles written by David Prulhiere by visiting redwood reverse mortgage. For a limited time, get the free report titled: “Five Essential Things to Know Before Getting a Reverse Mortgage” just for visiting.

While the inherent costs of reverse mortgages and lack of ownership equity has had a negative impact on the potential growth of these products, the mortgage industry also must bear much of the blame for the product’s failure to gain wide mainstream acceptance among older homeowners. Aggressive marketing tactics and lack of valuable consumer information has caused much market confusion regarding these product. However, with a possible bottoming out of the real estate market and the recent reduction of closing costs for reverse mortgages, now may be the perfect time to take a fresh look at how these loans can supplement your retirement assets.

This spring has seen a revolution in the way reverse mortgage fees are charged. With banks slashing fees associated with these loans, consumers have seen a bonanza of opportunity. Increasing bank competition has allowed some seniors to tap into their home equity at a savings of fees in excess of $10,000. Without a doubt, this has been a boon to consumers who have taken advantage of this competitive climate.

With this increasing competition, however, a surge in aggressive marketing tactics my many reverse mortgage companies has been in full force. While these products are cheaper than ever before, consumers must be careful when dealing with mortgage brokers who are more interested in closing a deal than providing valuable information to the consumer. For this reason, it is now more important than ever that consumers work with a mortgage broker that will take the time to teach them about their options and educate the borrower as to the variety of products available in the marketplace.

Reverse mortgages can be tricky. However a good mortgage professional can cut through the difficulties and explain the loan’s terms in a simplified fashion. When selecting a broker, make sure you find someone who’s interested in learning about your needs and not just selling you a loan. By taking the necessary precautions now, you can save yourself significant headaches in the future.

Looking to find the best deal on Florida Reverse Mortgages, then visit www.thereversereport.com to find the best advice on retirement financing for you.

The Florida HECM for Purchase makes it easy for borrowers to purchase a home with a reverse mortgage. Borrowers can use the proceeds to move to a new location or to downsize their primary residence to meet their retirement needs. Seniors could also conceivably sell their existing home and use the proceeds to buy a larger home financed with the reverse mortgage. The amazingly flexible product makes almost anything possible.

Purchasing a new home with a reverse mortgage is very similar to purchasing a new home using conventional financing. However, the loan process tends to be shorter and more simplified. Generally the amount of money a borrower is eligible to take out is based upon the home’s value, the age of the youngest borrower and the current interest rates. When determining the home’s value, the bank will generally use the lower of the appraised value, the FHA limits or the purchase price. The amount of money the borrower would need to provide at closing is the difference between the loan’s value and the amount of money the borrower is eligible to borrow, minus any closing costs. The appraisal, inspection and closing processes are almost exactly the same as in conventional financing.

The purchased property only needs to meet standard FHA requirements to be eligible for a reverse mortgage. Certain condominiums and multi-family dwellings are generally eligible. Single family homes are almost always eligible. Newly constructed properties are also eligible, however the building must have receive a certificate of occupancy by closing. In any event, the borrowers must be ready to move into the home within two months of closing.

Reverse mortgages are no more difficult to obtain than regular mortgages. In fact, in many ways they are much simpler. Borrowers do not need to meet any particular credit or income eligibility since there is no obligation to repay the loan as long as the borrowers continue to live in the home. They must continue to keep their taxes and homeowners insurance up to date, however. Another great benefit of the reverse mortgage is the non-recourse nature of the loan. This aspect of the loan means that a person can never owe more than their home is worth even if the home drops in value drastically.

Reverse mortgages will definitely grow in number over the coming decades. As more seniors reach retirement age and look to move into their retirement homes, expect to see more and more homes purchased with these loans. Financing a new home with a reverse mortgage and eliminating all monthly mortgage payments is certainly an attractive alternative for many on a limited income.

Before you purchase your new retirement home, make sure you check out Reverse123, information on Florida Reverse Mortgage and Senior Financing

Benefit From the Equity That is Already Earned

The money that is lent in a reverse mortgage is based on the existing equity in a senior’s home. If a person has lived in a home for a long period of time and has paid the regular mortgage loan for years, the reverse mortgage can be looked at as a return on that investment. The money that comes from a reverse mortgage can replace the money that has been paid into a traditional mortgage payment during the normal ownership of the property. A reverse mortgage can free seniors from the worry of making regular mortgage payments for the rest of their lives.

Supplementing Retirement Income

Reverse mortgage proceeds can be distributed over a number of years. Although a lump sum distribution is available, it is not necessary. The borrower has the ability to manage their payments as they see fit. In this respect, the borrower is able to control the funds as needed. In many ways, this line of credit can be used as a savings account to protect the borrower from unexpected expenses and medical emergencies. Actually, the proceeds can be used for almost anything the borrower chooses.

Reverse Mortgage Basics

When a borrower decides to take out a reverse mortgage, the first step is usually to take an appraisal of the home to determine the level of the borrower’s equity. During the entirety of the loan, the borrower continues to own the property. In addition, the borrower is required to keep the taxes and homeowner’s insurance on the property current. As long as these requirements are met and the borrower continues to maintain the home as their primary residence, the loan will not become due.

When the Loan Comes Due

There is no obligation to repay the reverse mortgage as long as the borrower maintains the home as their primary residence. Upon the death of the borrower or once the borrower has been out of the home for more than 12 months, the loan becomes due. The loan can be repaid by the heirs in a number of different ways: they can pay the loan outright, they can refinance the mortgage with a conventional mortgage or they can sell the home and use the proceeds to repay the loan. In no event would the heirs ever be required to pay an amount in excess of the homes value.

Want to find out more about reverse mortgages, then visit Reverse123′s blog on HECMS.

Fraudulent Reverse Mortgage Practices

Unfortunately, as with many products geared towards seniors, there is not limit to the number of unsavory individuals who will use any opportunity to take advantage of society’s most vulnerable citizens. On scam that was recently exposed involved reverse mortgage originators placing seniors in housing and then taking a reverse mortgage off those properties. The criminals then absconded with hundreds of thousands of dollars off of the unsuspecting seniors. The FHA is working hard to prevent these types of scams, but the products’ reputation continues to suffer.

Some Good News Develops

In general, the news about reverse mortgages is good. An increasing number of seniors have chosen to take advantage of the benefits of reverse mortgages in order to stabilize their financial situations by cashing in on the existing equity of their homes. Though the mortgages are not inexpensive, the method of repayment makes them ideal for many senior citizens. Reverse mortgages do not have to be repaid until the borrower dies or sells the house. Most often the cost of the reverse mortgage loan is recovered through the sale of the property, which often makes the loan payment-free during the borrower’s life.

Reverse Mortgages Can Change Lives

There are several cases in which a reverse mortgage has meant the difference between a comfortable retirement and scraping along to just get by. Seniors who were in danger of losing their homes due to unpaid property taxes have been able to remain independent through reverse mortgage loans. Reverse mortgage payouts have been used to eradicate mortgage payments and cover the costs of property tax and insurance for the duration of a senior’s life. The money that would have gone to pay the monthly mortgage has been transferred to other, more pleasant uses. The reverse mortgage system has brought peace of mind and financial stability to a large percentage of senior citizens who have retired and own their homes.

Costs Continue to Fall

The most encouraging recent news about reverse mortgages is that the costs related to the loans are falling rapidly. Reverse mortgage lenders are cutting costs related to the mortgages at every level, which makes reverse mortgages beneficial for seniors who are struggling with finances as well as seniors who would like to use a reverse mortgage as a safety net in case unexpected expenses arise. The largest cut has been in the percentage a lender charges for closing costs. The rate has dropped by as much as $10,000 in some cases.

Looking to find the best deal on reverse mortgages, then visit www.reverse123.com to find the best advice on reverse mortgages for you.

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