Welcome!




Expand Your Education with These Courses from
Becoming a Successful Sales Professional: Skills for Sales Success: Part One.
Time Management: Skills for Sales Success: Part Two.
Customer Relationship Building: Skills for Sales Success: Part Seven.
Expand your education through NAR's REALTOR® University: A Consumer Advocate Approach to Mortgages: Course 2.
Bundle 2: CIPS Elective Courses (Non-US Version).

Survey – Homeowners Using Reverse Mortgages to Pay For Everyday Expenses, Essential

Have a comment on this article? Share on Facebook!

RISMEDIA, April 7, 2008-A survey of 213 homeowners who have received reverse mortgage loans found that the number one reason for the loan is to pay for daily living expenses. Only 3% say they used the funds from a reverse mortgage loan to take a vacation.

The survey was conducted in January by Consumer Credit Counseling Service of Greater Atlanta, Inc., a credit counseling agency that provides reverse mortgage counseling. The homeowners average 74 years old and have lived in their homes an average of 18.5 years. The average purchase price of their homes was $95,554 and the respondents said that the current value of their homes was approximately $221,997.

When asked the question, “What prompted you to obtain a reverse mortgage loan?” the responses were:

– Budget too tight – 19%
– Need more liquid assets on hand – 16%
– Home repairs and maintenance – 15%
– Provide care for dependents, pay medical bills – 8%
– Pay property taxes and homeowner’s insurance – 7.23%
– Falling behind on monthly payments – 6.25%

A person must be 62 years of age or older to be eligible for a reverse mortgage. A reverse mortgage is a loan that allows homeowners to convert the equity in their homes into tax-free income without having to sell the home, give up the title, or take on a new or additional monthly payment. Loans must be repaid when the homeowner no longer lives in the home.

“We expect the demand for reverse mortgages to grow significantly as baby boomers reach retirement and need funds to meet daily expenses,” said Sue Hunt, manager of reverse mortgage counseling for CCCS. “It is important for homeowners to educate themselves about reverse mortgages. Credit counseling can help them understand how these loans work.”

While 79.4% of the respondents are retired, 10.5% work part- time jobs, nearly 5% work full-time and another 5% said they were looking for a job.

Most reverse mortgage lenders require homeowners to obtain counseling prior to receiving the loan. To qualify for a reverse mortgage, a person should have a significant amount of equity in their home and the home must be in reasonably good condition.

Although income and credit history are not considered in securing a reverse mortgage, CCCS believes it is critical for homeowners to review their entire financial situation during counseling. Reverse mortgage clients need to develop effective budgeting skills to meet periodic expenses, such as property taxes and homeowners insurance.

For more information, visit http://www.cccsinc.org and cccsenespanol.org.

Want instant access to great articles like this for your blog or newsletter? Check out our 30-day FREE trial of REsource Licensed Real Estate Content Solutions. Need easy stay-in-touch e-Marketing solutions too? Try Pop-a-Note for 99 cents!
Join RISMedia on Twitter and Facebook to connect with us and share your thoughts on this and other topics.




Categories: Uncategorized

Copyright© 2014 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia's REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com

Our Latest News >>