Reverse Mortgages for Senior Citizens Continue to
Grow Despite Mortgage Turmoil; Tampa Leads
New features for 2009: higher loan limit, lower
fees, home purchase component, co-op eligibility and stricter consumer
protection
Jan.
14, 2009 The regular mortgage market may be suffering but the reverse
mortgages for senior citizens are still growing and, should benefit
from several new features in 2009. New data released by the Department
of Housing and Urban Development shows that on a calendar year basis,
the number of federally insured reverse mortgages closed in 2008 grew
6.4% to 115,176 loans.
As more seniors try to figure out how to cope with
todays economic conditions, the HECM program takes on increased
significance, said Peter Bell, President of NRMLA.
Purchase Reverse Mortgage Program allows seniors to
purchase a new home, never make a mortgage payment for as long as they
live in the home, may require sizable down payment
A more detailed analysis of HUD data conducted by
Reverse Market Insight, a consulting firm based in Aliso Viejo, CA,
indicates that three of the top 10 markets in the country are located in
Florida. Miami was the top market in the country by a 2 to 1 margin.
FHA insured 9,561 HECM loans in the Miami metro area.
Miami was followed by Los Angeles (4,126), Tampa
(3,956), Santa Ana, CA (3,695), Baltimore (3,595), Phoenix (3,582),
Orlando (3,556), Richmond, VA (3,493), Philadelphia (3,317) and Chicago
(3,184) to round out the top 10.
Further analysis by Reverse Market Insight shows
that 2,949 lenders originated at least one HECM loan in 2008, a 76.5%
increase over the prior year.
Changes for 2009
Bell anticipates newly enacted changes to the HECM
- including a higher loan limit, lower fees, home purchase component,
co-op eligibility and stricter consumer protections around cross-selling
reverse mortgages with other financial services products - will lead to
even more growth in the coming months.
The strong growth were seeing suggests the HECM
program remains a strong and viable option for Americas seniors as they
develop their financial plans for retirement , added Bell.
For Housing and Urban Developments (HUD) updated
version of Ten Things You Should Know About a Reverse Mortgage,
click here.
Reverse mortgages appear to becoming a more
mainstream financial planning tool for older homeowners. A reverse
mortgage enables older homeowners (generally age 62+) to convert part of
the equity in their homes into income without having to sell the home,
give up title, or take on a new monthly mortgage payment.
The reverse mortgage is aptly named because the
payment stream is reversed. Instead of making monthly payments to a
lender, as with a regular mortgage, a lender makes either one or more
payments to the borrower. The loan is repaid when the borrower moves
out of the property.
About NRMLA
NRMLA is a nonprofit trade association, based in
Washington, DC, whose mission is to support the continued evolution of
reverse mortgages as an important financial option for senior homeowners
while educating both its members and consumers about the varied
applications of this unique loan. Members sign a Code of Ethics and
Professional Responsibility pledging to abide by guidelines that assure
fair, ethical, and respectful practices in offering and making reverse
mortgages to seniors. Details on NRMLA, reverse mortgages, and a list of
reverse mortgage lenders in each state are available on NRMLAs Web
site, at
http://www.reversemortgage.org.
About Reverse Market Insight
Reverse Market Insight is a leading provider of
market research and data services for the reverse mortgage industry.
Founded in 2007 by industry veterans, RMI counts 7 of the top 10 reverse
mortgage lenders as clients, and is the exclusive provider of market
intelligence for the National Reverse Mortgage Lenders Association.
Keep up with the latest news for senior citizens, baby
boomers
Jan.
14, 2009 The regular mortgage market may be suffering but the reverse
mortgages for senior citizens are still growing and, should benefit
from several new features in 2009. New data released by the Department
of Housing and Urban Development shows that on a calendar year basis,
the number of federally insured reverse mortgages closed in 2008 grew
6.4% to 115,176 loans.