LET US HELP YOU UNDERSTAND REVERSE MORTGAGES!
If you watch late night television, you've probably seen the commercials. One of the most famous is Henry Winkler, better known as Fonzie or "The Fonz" from Happy Days, selling America on this growing financial product. That's right, we're talking about reverse mortgages. These specialized loans are designed for Americans age 62 and up to draw equity out of their homes. These loans can be complicated and difficult to understand, but I'll try to help you figure them out!
The first reverse mortgage was originated all the way back in 1961. However, the industry did not take off until 1987, when the Home Equity Conversion Mortgage (HECM) was launched. Today, this HECM product dominates reverse mortgage originations. Additionally, you will not find major banks, such as Bank of America or Wells Fargo, offering reverse mortgage loans. Instead, the market is dominated by non-depository players such as Liberty Reverse and Generation Mortgage.
Reverse mortgages have developed a somewhat mixed reputation over the years. There are occasional scams and fraud associated with the product, and there have been instances where seniors have lost their homes (a husband and wife take out a reverse mortgage, only the husband's name is on the loan, and then he passes away, for example). All of that said, the reverse mortgage is a product that many elderly Americans are going to need to make ends meet in retirement.
Sources:
reversemortgage.org
reversemortgagealert.org
The first reverse mortgage was originated all the way back in 1961. However, the industry did not take off until 1987, when the Home Equity Conversion Mortgage (HECM) was launched. Today, this HECM product dominates reverse mortgage originations. Additionally, you will not find major banks, such as Bank of America or Wells Fargo, offering reverse mortgage loans. Instead, the market is dominated by non-depository players such as Liberty Reverse and Generation Mortgage.
Reverse mortgages have developed a somewhat mixed reputation over the years. There are occasional scams and fraud associated with the product, and there have been instances where seniors have lost their homes (a husband and wife take out a reverse mortgage, only the husband's name is on the loan, and then he passes away, for example). All of that said, the reverse mortgage is a product that many elderly Americans are going to need to make ends meet in retirement.
Sources:
reversemortgage.org
reversemortgagealert.org
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