How The HECM For Purchase Program Is Useful To Gresham Home Buyers

How The HECM For Purchase Program Is Useful To Gresham Home Buyers

Stone Bridge Mortgage Group_When to Consider a Reverse Mortgage_01

 

What Is The HECM For Purchase Program?

The Home Equity Conversion Mortgage (HECM) for Purchase is a reverse mortgage that allows seniors, age 62 or older, to purchase a new principal residence using loan proceeds from the reverse mortgage.

In 2009, the HECM for Purchase program began as a way to use a reverse mortgage to purchase a new home. At the time, many people were using a costlier and more complicated two-step process to purchase a new home. It was common for homeowners to obtain a traditional mortgage to purchase the home and then use a reverse mortgage to pay off the first one. Seeing this, the government sought to simplify the process and costs.

Reverse mortgages have been gaining acceptance with many Gresham homeowners. And for Gresham retirees looking to buy another home, the HECM for Purchase program can be a useful tool. The HECM for Purchase program allows fewer distribution needs from the investment portfolio because a greater portion of the home’s cost can be financed by the reverse mortgage, which does not require payments until the loan balance becomes due.

Gresham Retirees Can Use This Program To Downsize Or Upsize A Retirement Home

Another group who may find the HECM for Purchase program useful is Gresham retirees. When downsizing, Gresham retirees will find this program useful because it could free up more assets from the sale of the previous home to be used for other purposes. On the other hand, when upsizing, the HECM for Purchase could allow for a more expensive home. This is a great opportunity for Gresham retirees who may be concerned about obtaining a traditional mortgage, as it may become increasingly difficult to do so after retirement.

What Happens If The Loan Balance Exceeds Home Value?

It sometimes happens that a borrower may live in the home long enough that the loan balance may grow to exceed the value of the home. However, this too can be useful to Gresham homeowners. Gresham homeowners could use the HECM for Purchase program as a way to provide housing services as long as they remain eligible for a total cost equal to the portion of the home value and up-front costs not covered by the HECM. On the other hand, for Gresham borrowers who leave the home while the loan balance is still less than the home value, the home could be sold with any remaining equity still available to the borrower after the loan is repaid.

Gresham Homeowners Can Lower Monthly Costs With The HECM For Purchase Program

When Gresham homeowners don’t have to make a monthly mortgage payment with the aid of this program, it reduces the household’s fixed costs. This provides potential relief of any need to spend down investments to Gresham homeowners. The HECM for Purchase option can be analyzed relative to paying outright for the home with other assets or opening a fifteen-year mortgage if still feasible.

Gresham homeowners who find themselves curious about this program can contact Stonebridge Mortgage Group. We are happy to answer any questions and help Gresham homeowners figure out if the HECM for Purchase program is right for them.

Stonebridge Mortgage Group Offers Guidance On All Mortgage Matters

For professional assistance with mortgages and related services, look no further than Stonebridge Mortgage Group. You can rely on Stonebridge Mortgage Group to help guide you through the entire home buying process. We can help get you pre-approved for a mortgage and assist with real estate loans and other mortgage solutions—both residential and commercial. Stonebridge Mortgage Group serves the greater Portland area and is located in Gresham, Oregon. Don’t wait to get quality assistance with your home buying needs!

Call us today at 503.661.5580

 

 

Important Information to Understand

  1. At the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds.
  2. Charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees.
  3. The loan balance grows over time and interest is charged on the outstanding balance.
  4. The borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home.
  5. Interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full repayment.

 

Reverse Mortgages Are Becoming More Accepted

Reverse Mortgages Are Becoming More Accepted

Stone Bridge Mortgage Group_Things To Know About Reverse Mortgages

Though reverse mortgages were once considered highly controversial, financial planners are beginning to see reversing your mortgage as a legitimate option for those who struggle with retirement savings. More and more people are finding it difficult to save up for a retirement fund. However, home equity “conversion” loans can aid those who have struggled to save by augmenting their retirement income. Part of the widely growing acceptance of reverse mortgages is due to the Federal Housing Administration tightening lending standards. Reverse mortgages are now a good tool for retirees.

What gave reverse mortgages such a bad reputation?

Put simply, overly aggressive brokers took advantage of the reverse mortgage system. These brokers gave loans to senior citizens who lacked financial savvy and profited from them in the form of large commissions. The system of reverse mortgages wasn’t polished enough, and during the Great Recession as many as 10% of all reverse mortgages fell into default.

Growing acceptance and higher standards

The FHA tightening the standards for those looking to reverse a mortgage helped to rectify a system that had previously made it easy to take advantage of clients. The newer standards make it harder for clients to make themselves vulnerable to financial disaster. For example, now the amount of equity a homeowner can take out in the first year is limited to 60%, removing the obvious temptation of taking out 100%. Taking out too much too soon can easily lead to the client being overwhelmed and causing their loan to go into default.

Credit standards were raised as well. Homeowners who don’t have robust finances or who have struggled with making payments in the past may now be expected to put money aside in an escrow account to cover future expenses. Additionally, to qualify for a reverse mortgage you must be at least 62. You must not only have substantial equity in your home, but also be able to keep up with taxes, insurance payments, and home repairs.

Balancing your funds while in retirement

If you decide to take out a reverse mortgage, it is recommended that you have another source of money to draw upon. For example, being able to draw funds from cash, home equity, and investments, can make your finances more stable. Having the choice to tap into different funds, depending on how the market is doing, can be extremely useful. When the markets are up, you can tap into your investments. When they’re down, you can shift to real estate.

Talk to the professionals at Stonebridge Mortgage Group about the possibility of reversing your mortgage.

For professional assistance and advice on reverse mortgages, look no further than Stonebridge Mortgage Group. You can rely on Stonebridge Mortgage Group to help guide you through the home buying process. If you’re ready to apply for a loan and want to go through the process online, Stonebridge Mortgage Group offers online applications. We can help you get pre-approved for a mortgage, walk you through the real estate loan process, and assist you with mortgage solutions, both residential and commercial. Stonebridge Mortgage Group serves the greater Portland area and are located in Gresham, Oregon.

 

Call us at 503.661.5580

 

Important Information to Understand

  1. At the conclusion of a reverse mortgage, the borrower must repay the loan and may have to sell the home or repay the loan from other proceeds.
  2. Charges will be assessed with the loan, including an origination fee, closing costs, mortgage insurance premiums and servicing fees.
  3. The loan balance grows over time and interest is charged on the outstanding balance.
  4. The borrower remains responsible for property taxes, hazard insurance and home maintenance, and failure to pay these amounts may result in the loss of the home.
  5. Interest on a reverse mortgage is not tax-deductible until the borrower makes partial or full repayment.

 

Consumer And Commercial Loan Officers With Stonebridge Mortgage

Consumer And Commercial Loan Officers With Stonebridge Mortgage

Stone Bridge Mortgage Group_Consumer And Commercial Loan Officers With Stonebridge Mortgage

When you think of loans and integrity, Stonebridge Mortgage should be the first name that comes to mind. We understand how important it is to match a person with a loan that meets their needs and abilities. It’s why we take the time to match our lenders and consumers. Your Stonebridge Mortgage Group Loan Officer is here to help you with everything you need to find the right loan for you.

Stonebridge Mortgage Group Specializes In Commercial And Consumer Loans

Whether you need a commercial or a consumer loan, we scout the right lender to match the needs of our clients. Our diligence allows both the lender and the customer the confidence that everything has been properly reviewed. It is important that both parties have the transparency they need to move forward with a sense of security. We are happy to make this happen and we do it well.

We Set You Up To Succeed

Our loan officers have the expertise and care to take the time to gather all the necessary information that is needed for a successful loan process. We will never rush the loan process at the cost of accuracy. We pride ourselves in making sure every customer has a clear understanding of what loans and options are available, what the payments will look like, and ensure that all the fine-print details are out in the open.

We Strive For Satisfaction On Both Sides Of The Loan

At Stonebridge Mortgage Group, we advocate for the best terms available on your loan. Individuals work hard for their money. We want each client to feel good about their loan. We also want to instill confidence in our lenders that they can count on complete and timely payments on each loan. We believe in building successful partnerships between clients and lenders, which is something we do quite well.

We Take Pride In Every Loan We Make Possible

At Stonebridge Mortgage we are dedicated to making sure you end up in the home of your dreams. If you need assistance with buying or financing for your home or business, we are here to help. Learn more about working with a Loan Officer at Stonebridge Mortgage Group and Stonebridge Mortgage Group’s other services.

 

Do you have questions? Give us a call at: 503-661-5580