If a senior has gone to the counselor meeting with good preparation and given sufficient information to the counselor, then the duty of the counselor is to tell about the alternatives and to recommend certain solutions to a senior. A senior has to talk with the other seniors, who have the same kind of a loan and to collect information from the Internet. This is the way to prepare for the counselor meeting.
What type of mortgage plan do you think would be best for us? Why? Listen to the suggestions the lender might recommend. Do further research before deciding on the type of mortgage that might be best for you.
With your mortgage, you'll also become aware that not all mortgage rates are created equally. In most cases, you'll be offered and adjustable interest rate, with caps as to how high it can jump in a year and over the life of the loan. As the national rate changes, so will your interest rate. However, on the other hand, you might also opt for a fixed interest rate. This might not be offered right away, but if you refinance your mortgage, you can often get the fixed interest rate.
The maximum claim amount is a cap on the principal limit. This cap is set at the lesser of your home's appraised value or the FHA max loan amount for houses in your geographic area. Think of this as the zip code cap.
The said insurance come in variety of forms. Aside from PMI, there are other types of the mortgage insurance. There is one provided by the Federal Housing Administration or the FHA. They provide insurance to those whose earnings is below the average. The Veterans Administration also provides insurance. They insure the senior citizens who are at least 65 years old. It is important to be aware of these options to learn how to qualify for them.
This document (also called the GFE) is an estimate of the fees and charges associated with the loan you are applying for. By law every lender or broker is to provide you with this estimate within three business days of the loan application.
Principal limit or maximum principal limit is the total aggregate amount of money that will ever be available over the life of the reverse mortgage. Whether the money is paid to the borrower monthly, in a lump sum, or from time to time, when you count every dollar paid from the loan it cannot add up to more than the principal limit.
First, when you apply for a mortgage, you'll likely get pre-approved for a certain amount. This gives you a starting point. You'll know your price range when you look at houses and you'll have an idea of the closing costs and interest rate you'll be paying. The mortgage lender will give you this information as a Good Faith Estimate. Those figures will be good for a limited amount of time, but when you really do find a home and apply for the mortgage, the rates shouldn't change much.
The good news for mortgage rates lately is that when we have a slower economy, it will draw the folks that invest in stocks to move that money over to bonds, which includes Mortgage-Backed Securities. Simply, when demand for mortgage bonds financial planning
increases that will lead to higher bond prices and "bingo" we all get lower mortgage rates!
One of the benefits of the reverse mortgages is, that they allow the seniors to live in their old homes, while tapping a part of their home equities. The ownerships do no change meaning that the seniors can enjoy about the rising property prices.
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