Reverse Mortgage Performance is Good Despite the Rumors

While many reports have not shined favorably on the mortgage industry, there is some good news coming forth regarding reverse mortgages. They are doing well, in fact the final numbers rolled out earlier this month from the end of 2010. Believe it or not, there was more than $3 trillion in home equity loans being held by seniors, age 62 and up. When you look at the country’s overall financial picture, it really isn’t all that hard to understand, but it’s sad that seniors are carrying that burden. However, the good part is how the reverse loans are structured, giving them money back in exchange for the property. 

Seniors Make a Sacrifice, but They do Better Financially 

Reverse mortgages enable senior citizens to let go of their home in the end, in return for signing up for a mortgage that makes payments to them. While values are a bone of contention in real estate circles, seniors have fared well in getting these loans closed. There is plenty of counseling upfront to ensure that they understand what is involved, and their family members or caretakers are encouraged to learn about the programs as well so that they can be of assistance should the need arise. While the children might fear they won’t get the property, in some cases it might be the best thing for their parents. This is especially true at a time when values are going down, and there may not be much of a profit regardless on the home. Making the equity work for them is what it’s all about, and it’s doing well.

Is Real Estate Making a Comeback?

While things may look bleak to the consumer, I get a different view of what is happening everyday as I interact with borrowers on purchase loans and refinance deals. This is good, because it helps me keep things real with those I encounter daily. The media can be so negative, and naturally the more television we watch the worse things appear. There are some interesting things happening, and I will tell you about a few of them.


Foreclosures are slowly rolling in, which is good. I would rather see them go slowly over the hill than flood the banks paper reams. However, I don’t want to see any foreclosures because I don’t enjoy watching families lose their homes. One main benefit, and probably the only benefit is for those looking to buy a home that can now get more house for less money, and for less of a down payment upfront. FHA allows buyers to bring as little as 3.5% down on their new home purchase. This allows the buyer to make an investment, but not have to pull out all of their savings to do it.

Sales are up too, which is always good news. The buying seem to come to a halt after the tax credit expired, but in the end people realized that they can’t just sit on buying a home not knowing whether or not that tax credit would be implemented again. There is nothing worse than waiting, and while some people are good at it, most people hate it. This is still a great time to buy a home, or even refinance the one you are in. In regards to buying a home, there are so many homes out there for buyers to pick from. Whether this is your first time buying a home, or your second, there is still time to get a great deal on a house.

-Mayer Dallal

The Beginning of an FHA Home Purchase

When shopping for a home, make sure that you get your FHA prequalification before hiring a real estate agent. The real estate agent needs to know that you are equipped to buy the home, before they spend time doing the shopping on your behalf. They too spend a lot of time to help you find your new home. Using a real estate agent that is familiar with the FHA guidelines and qualifications will save you a lot of time and money in the process of buying your new home.




Once you find a home that you like, you will submit an offer through your real estate agent. If the seller counters your offer, you will want to try and negotiate until you can all come to an agreement. Once the seller accepts the offer it will become a legally binding contract. You will need to make sure that everyone is aware of any contingencies in the contract, and that any seller concessions have been accounted for.



Make sure that any offer is contigent upon getting a home inspection. Your home inspection will give you more information on the details of this property. For example, if the heating system is 25 years old, that is something you will want to know. That way if any changes need to be made to the contract they can be, as well as any repairs that you would like to have done.

-Mayer Dallal