California Reverse Mortgage News


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

Here are a few reasons why A HECM Reverse Mortgage Line of Credit is better than a HELOC

HECM Line of Credit Lender Can't Close Out Your Credit Line Without Your Consent.
A HECM Line of Credit can not be closed by the lender.  Remember when equity took a dive in 2007 and lenders closed out your HELOC (home equity line of credit) without your permission?  A reverse mortgage lender is prohibited from doing that. Once all qualified borrowers have passed away, the line will be frozen at that time.

Reverse Mortgage Has More Flexible Payment Terms.
A typical payment terms on a HELOC is usually 25 years, with the first 10 years being  the time you can take advances and make interest only payments, than that option goes away, and than the remaining 15 years you get a big payment jump, and now have to payoff the entire loan over the remaining 15 years.
The HECM Line of Credit doesn't require any payments ever.  However, you can choose to make payments if you so desire, at any time. 

HECM Available Line of Credit Can Increase Dramatically Over Time.
If you run out of funds on the HELOC, you have to refinance and get more money and you have to qualify with enough income, equity and good credit to obtain the refinanced HELOC.
With a HECM Reverse Mortgage Line of Credit, there is a built in growth rate tied to the unused line of credit.  It actually increases every month for more tax free money for you to use at your discretion.  No refinance needed.
The amount of the credit line increase will depend on how much is left on the line of credit, and the growth rate (which is attached to the line), but it's possible for your line of credit of usable money to double or triple over time, again it's tax free money.

A Reverse Mortgage Has "Gap Insurance" Built In Case Your Home Is Upside Down
A HECM Line of Credit has FHA MIP, which ensures if the property when being sold has a mortgage balance higher than the value, the balance is covered and heirs need not worry.
This is not the case with a HELOC.  MIP is not built into a HELOC.
 
These are a few of the differences between a HELOC and a HECM Reverse Mortgage Line of Credit. 
If you have any question or concerns regarding the HECM Reverse Mortgage Line of Credit or the HECM Reverse Mortgage Line of Credit Growth Rate, feel free to visit my website for free videos that further explain this concept, at www.californiareversemortgage.biz or feel free to give me a call or drop me an email.

Best,
Kevin Walton
Certified Mortgage Advisor
800-506-0632 ext. 0

Posted by Kevin Walton on September 8th, 2015 2:52 PM