California Reverse Mortgage News

A standby Reverse Mortgage Line of Credit is becoming a must have for young retirees. However it's not to be confused with a bank HELOC.
Here's a few differences:
The Reverse Mortgage Line of Credit has a growth rate attached to it which allows the unused line of credit to grow over time, (no refinance needed)resulting in more future tax free funds to use.
A $100,000 line of credit, left unused, can double or triple in size over time, meaning more tax free funds to use when needed, a bank HELOC doesn't have this feature.

The key is to originate the Reverse Mortgage line of credit as early in age as possible.
Financial Planners like this Reverse Line of Credit feature because it serves as a hedge against rising interest rates, because as rates rise, so does the growth rate on the line of credit which translates into more future funds for the borrower to use.

If the property falls in value, that does not affect the growth rate, it keeps growing, and the Reverse Mortgage lender can not close out the line of credit for that reason, whereas on a bank HELOC, they can close the line of credit for falling property values.

The growth rate has the compound interest feature as well which allows for rapid growth over time, a HELOC doesn't allow for this, in fact it doesn't allow for any growth at all, you have to qualify for another HELOC loan to get more money. 

After allowing time for growth, which means not touching the line of credit for a period of time, once the borrower starts taking advances on the line the Reverse Mortgage line of credit doesn't require any monthly payments to pay it back, a bank HELOC requires a monthly payment.
The borrower however can make a monthly payment on the Reverse Mortgage if they like, it's up to them.  It's worth mentioning that for each month the borrower doesn't make a payment, the interest owed gets tacked on to the balance of the loan.

The standby Reverse Mortgage line of credit is another bucket of tax free income for seniors and the growth rate feature is seldom discussed, but is a powerful tool that can create wealth, protect assets, and help a senior to not outlive their assets.
Educating senior citizens, and the financial services sector will take time but is a worthwhile endeavor.

For questions on the Reverse Mortgage line of credit, feel free to give me a call or drop me an email, or visit my site.

Best, Kevin Walton
Best Capital Funding
Certified Mortgage Advisor and Reverse Mortgage Specialist
www.californiareversemortgage.biz
californiareversemortgagebiz@gmail.com
800-506-0632 ext. 0
Posted by Kevin Walton on October 16th, 2015 10:11 AM

The HECM Reverse Mortgage Line of Credit is fast becoming a key retirement tool for baby boomers.
Word is getting out that Reverse Mortgage Line of Credit growth rate allows the amount of unused available credit to grow over time, which means more accessible tax free money when the senior needs it.
The idea is to take out the Reverse Mortgage Line of Credit as a reserve, where you don't use it right away.  It's a set it and forget it mentality.  As it sits there idle, the line of credit of unused funds grows over time.  It can grow to double or triple its size and when you withdraw the funds it's tax free.
A bank home equity line of credit does not have this capability.
The bank can also close your line of credit in a down real estate market without your consent.  Not so, with the HECM Reverse Mortgage Line of Credit, it can't be closed for home value reasons.
Can the Reverse Mortgage Line of Credit grow to the point where it exceeds the value of the home?  Yes it can. So what happens if the property needs to be sold and the property value is under water?  The M.I.P., mortgage insurance premium that comes with the loan pays off the difference.  It's like gap insurance and heirs can rest easy that aren't responsible for the balance.
You owe it to yourself to check out the HECM Reverse Mortgage Line of Credit and it's growth rate feature and see why it's fast becoming a financial planning tool for our Baby Boomer generation.
Click here to watch a video on the HECM Reverse Mortgage Line of Credit growth rate.
Best,
Kevin Walton
Best Capital Funding
Certified Mortgage Advisor




Posted by Kevin Walton on September 28th, 2015 11:12 AM