Reverse Mortgage Loan Stats April 2015

The Home Equity Conversion Mortgage is the federally insured reverse mortgage product. It is insured by the Federal Housing Administration (FHA), a branch of the U.S. Department of Housing and Urban Development (HUD). HECMs account for nearly all reverse mortgages made today in the U.S.

Below are the number of HECM loans made in 2015 to date. HUD provides data by federal fiscal year (each federal fiscal year begins October 1 and runs through September 30 of the following year. FY 2014, for instance, began October 1, 2013, and ends September 30, 2014).

FY 2015–14,203

Is it time to find a remortgage?


There are two likely situations in which you might find yourself looking for a remortgage. You may be coming to the end of an existing mortgage deal, in which case you have a choice of automatically moving onto your lender’s SVR (Standard Variable Rate) or remortgaging to a new deal.

Secondly, you might be on an ongoing variable-rate or tracker deal but considering a remortgage – perhaps with another lender, perhaps to a fixed-rate deal.

Either way, it’s important to understand what’s involved in the remortgage process before you go ahead. There’s more information on remortgages here, but here’s a quick look at the questions you should be asking yourself before you start talking to lenders.

Would you be better off?

On the one hand, you may want to remortgage to a new deal with a better interest rate than you’re currently paying. In the current climate, this may not be too difficult: lenders are offering some of the lowest rates in years, and if you’ve kept up with your payments in the past then you’re more likely to get a better deal this time around.

You shouldn’t just remortgage for the sake of it. Sometimes when a fixed-rate term finishes, you may find that the SVR charged by your lender is actually significantly lower than the rate you were previously paying. But if it’s not, you should probably try to find a cheaper deal sooner rather than later.

Even so, you might still accept paying more if you’re switching from a variable-rate mortgage to a fixed-rate deal. A fixed rate means you’ll know exactly how much you’re paying every month, and you’ll be protected against sudden rises in your mortgage payments.

If you know you can afford it, it might be worth switching to a fixed-rate deal for the security it can bring, even if it is more expensive than your current arrangement.

Consider the added costs

Remortgaging rarely comes cheap. Mortgage lenders tend to charge some kind of arrangement fee, especially on fixed-rate deals, and this can often cost anywhere between £99 and £1,000 – sometimes more.

Most lenders will allow you to add this arrangement fee onto your mortgage to spread out the cost, but this will of course add to the total amount owed, and could increase your monthly payments.

Also consider the legal fees charged by your solicitor, which can also add up.

You must consider these additional costs, and whether you can afford them up front or if you will have to add them to your mortgage, before you start.

Pros & Cons of a reverse mortgages in 2011

Pros & Cons of a reverse mortgages

Increased gas prices, home insurance, inflation and the cost of living is sky high at the moment and it seems that everyone is feeling the pinch.  These days a social security cheque, small retirement fund and savings will not fill the financial void.  Those aged over 62 years are seeking other forms of payment for help.

If you are in this position and are equity rich, the reverse mortgage could be an ideal solution for you. The reverse mortgage will give you an extra income for as long as you live in your house and you will be able to take cash from your home without making anymore payments.

However, it is important you consider both the pro’s and con’s of the reverse mortgage before making a decision:

Pros

  • There is no monthly payment due until the homeowner moves, passes away or sells the home.
  • A good credit rating and income is not apart of the qualification process, this means it is easy to qualify for a reverse mortgage.
  • Regardless of interest rates, you will never need to pay back anymore more then the value of the house.
  • If you make your home your primary residence, you can receive the reserve loan payments for as long as you live in the property.

Cons

  • High repayment costs
  • Too much income for low-income seniors will mean they are over the allowable limit for liquid assets.
  • Reverse mortgages may not allow you to have access to all your equity, or even most of it.

Always seek advice from an impartial financial adviser to ensure you are told both the pros and cons in detail.