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Reverse Mortgage Expert in Nevada for HECM Loans & Purchase

maggie red hands

When it comes to purchasing a home using a Reverse Mortgage or accessing your equity to supplement retirement, you need an expert on your side. Maggie O’Connell has the experience and expertise to guide you through the options, efficiently assist through the loan process, offer competitive rates and terms and provide accurate answers to all of your questions. Offering HECM & Jumbo Reverse Mortgages in Nevada, California and all 50 United States!
“I’ll put my 23 years of Reverse Mortgage experience and expertise to work on your behalf!”

What is a Reverse Mortgage?

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A Reverse Mortgage is home loan designed for older homeowners. It allows borrowers to tap into the equity in their home without having to make monthly mortgage payments. Commonly known as the Home Equity Conversion Mortgage (HECM) it is insured by the FHA and HUD. The loan balance is repaid when the last remaining homeowner leaves the home permanently, sells the property or passes away. Homeowners maintain title and continue to pay their own property taxes, homeowner’s insurance and keep up the maintenance of the property. Just like regular mortgages, the reverse mortgage lender has a lien against the home. To be eligible, at least one borrower must be age 62 or older, must have title to the home and significant equity or the ability to bring in funds to create enough equity and the home must be the principal residence. With the HECM for Purchase program, equity is generated by bringing funds to closing. Eligible properties include Single Family Residence, 2-4 unit properties, townhomes, condos that are FHA approved and
manufactured homes that meet FHA requirements.

Home equity is often the most valuable asset for most Seniors and Boomers. By tapping into home equity and receiving tax free funds to boost retirement income, homeowner’s are able to live a more comfortable and financially secure life.

Who do you want to coordinate your reverse mortgage?

So you’re considering a reverse mortgage because you have decided that life is too short. You have equity in your home and you should be enjoying life more and not living like a pauper. Where do you start? What is the first step? How do you choose the person who will help you through the process? You certainly don’t what to be led down the wrong path by some newbee in the industry who doesn’t know what they are doing. You thought one of those big companies who advertise on TV are the way to go, after all, they are big! But after talking to someone on the other side of the country who wants to sign you up and pass you along the processing assembly line, you realize that’s not for you.

What if you found someone who will work with you from start to finish, who represents a federally chartered bank, who has many years experience originating HECM’s and hundreds of raving fans? Someone who will meet you personally in Northern Nevada. Someone who will give you the personal attention you need in such an important transaction as a reverse mortgage. I believe you have just found her…

How may I help you?      Contact Maggie O’Connell

MIP CHANGES TO HECM REVERSE MORTGAGES

Because HECM Reverse Mortgages are insured by FHA, MIP is required. Improvements have been made recently to allow for lower MIP charges for loans with lower initial loan amounts.  The new option has a low initial mortgage insurance premium (IMIP) at .5% if the funds received at closing is 60% or less of the available principal limit. If the principal limit usage is higher than 60% the IMIP is 2.5% of the home value or maximum claim

 

amount. The maximum claim amount high lending limit  remains at $625,500. For home values above this amount, we use $625,500 for calculating purposes. For very high home values, Jumbo Reverse Mortgages may be the best solution.  Click here to get Jumbo Reverse Mortgage Updates

A common question is, “Why is mortgage insurance necessary since I have a lot of equity?” The reason is, the MIP allows the HECM program to exist. Without it, HUD would not be able to insure the loan. Lenders would not be comfortable lending at competitive rates as they would need to carry the risk. The private reverse mortgages currently on the market have higher rates and lower loan to value ratios because they carry the risk of the mortgage going upside-down.

The other type of HECM mortgage insurance is the ongoing MIP which is 1.25% of the loan balance.  This amount is part of the ongoing accrual rate.

New Rules for Non Borrowing Spouses

To qualify for a reverse mortgage, one must be at least 62 years.  In the past, when there was a younger spouse, the couple did not qualify for the HECM.  While it’s best for both husband and wife to be on title and borrowers on the loan, there are now protections for younger spouses.   It is to be evaluated seriously as the younger spouse must deed off title.  It is important to talk to an attorney to  properly set up the deed or living trust so the non-borrowing spouse (NBS) can be quickly added to title if the ‘borrowing’ spouse passes.  The younger spouse has the right to remain in the home indefinitely during what’s called a deferral period if all the requirements are met. The surviving spouse must transfer the home into their name and become the legal owner within 90 days of death. Any funds remaining in the reverse mortgage account will not be available to the younger spouse.

 

In order for the Deferral Period to apply to a Non-Borrowing Spouse, the NBS must:
1. Have been the spouse of the borrower at the time of loan closing and remain married for the duration of the borrowing spouse’s lifetime;
2. Have been properly disclosed at origination and specifically named as a Non-Borrowing Spouse in the loan documents; and
3. Have occupied, and continue to occupy, the property as the Principal Residence.

Financial Assessment Qualification

Reverse Mortgage Financial Assessment

The Department of Housing and Urban Development has issued a financial assessment for HECM reverse mortgage borrowers. HUD calls for HECM lenders to evaluate the borrower’s willingness and capacity to timely meet their financial obligations and to comply with the mortgage requirements,” Those mortgage requirements include paying property taxes, homeowner’s insurance and keeping up home maintenance.

HUD states, “In conducting this financial assessment, mortgagees must take into consideration that some mortgagors seek a HECM due to financial difficulties, which may be reflected in the mortgagor’s credit report and/or property charge payment history. The mortgagee must also consider to what extent the proceeds of the HECM could provide a solution to any such financial difficulties.”

To Read the HECM Financial Assessment and Property Charge Guide, Click Here

Finance the purchase of your Nevada home with a Reverse Mortgage

There has been a big increase in the use of HECM reverse mortgages in Nevada as Real Estate Agents and buyers recognize the benefit.  Sellers are now more willing to accept offers with Reverse Mortgage financing as the product has become more mainstream.  It allows people to purchase a home using proceeds from the HECM along with their down payment funds.

To find out your down payment requirement submit your request here.

Reverse Mortgages are a helpful financial too that can be used to purchase a home. It’s used for those who don’t want to make mortgage payments and also want to minimize the cash requirement in your purchase transaction. The down payment requirement is calculated based on age of youngest borrower or non-borrowing spouse, home value up to the maximum claim amount ($625,500) and current expected interest rate.

Reverse mortgage interest rates options are:

The new annually adjusting LIBOR is now available in all states. Enjoy the current low variable interest rates, only a 5 point lifetime cap above the start rate and the rate cannot increase more than 2 points annually. This option is very popular as a line of credit or monthly payment option is available and borrower’s have access to full principal limit on the second year. 

The fixed rate option offers an interest rate that does not change over the life of the loan. The expected interest rate has a direct impact on the amount available to the borrower. Contact Maggie for current rates.

              Happy Reverse Mortgage Lady Let me explain how the amount available to the reverse mortgage borrower is calculated.  There are three factors involved in the reverse mortgage calculation:  1) Age of youngest borrower 2) home value or maximum claim amount and 3) expected interest rate.  The expected rate is tied to the 10-Year
LIBOR index and is used for calculation purposes as an indication of what rates are expected to be over a longer period of time.  The accrual rate uses the 1-Month LIBOR index or 1-Year LIBOR index depending upon the option selected. The index is added to your margin and determines the interest rate charged on the outstanding reverse mortgage loan balance.  But the expected rate determines how much you will receive from the reverse mortgage or HECM.

Read the customer reviews in the sidebar to find out what her clients have to say about their experience working with Maggie O’Connell. Seniors can rest assured they have made the right choice for their Reverse Mortgage Originator.