Posted on: 19th Oct, 2005 11:55 pm
The recent hurricane disaster in the U.S has made several homeless. In this scenario, there is confusion as to what will happen to the homeless seniors who have already started taking loan advances from their reverse mortgage limits. Reports say that there are about 3000 such reverse mortgage customers in the hurricane affected areas.
In case of a reverse mortgage, borrowers are allowed to get a line of credit which sums up to an amount that is equal to the property value. But the hurricane victims having lost their mortgaged property, it is uncertain as to whether they will get the entire loan amount. The situation may be better for those who have insured their homes. In such cases, borrowers can avail the cash. But if you do not agree to take on the remaining loan advance in spite of your property being insured, then you will have to pay back the principal along with interest.
On the other hand, victims having neither flood insurance nor homeowners insurance are doubtful regarding their further course of action. Even experts right now fail to predict what initiative HUD will be taking for the senior citizens. A number of loan servicers are right now continuing to pay the loan proceeds to the borrowers who have made the following insurance policies:
Officials of the Standard Mortgage Corporation based in New Orleans estimate that about 25% of the 1000 reverse mortgages have been made without any sort of insurance coverage. But some companies have decided to demand payments from those persons who have neither any insurance nor government aid. Others have decided to sell off the real estate of borrowers if they fail to pay off the mortgage. They also expect HUD to pay for the remaining amount.
Experts however anticipate that after the Katrina disaster, mortgage companies and lenders may be more lenient and may offer reverse mortgages to the affected victims for home purchase and home improvement. HUD is yet to approve reverse mortgages that can be offered for the purpose of home purchase. It is also expected to waive the limit of the HUD reverse mortgage provided for home repairs. Even the Congress is expected to remove the 250,000 cap on the number of reverse mortgages that HUD can possibly offer. This might help the Katrina victims to some extent as they can atleast have the opportunity of proper housing.
In case of a reverse mortgage, borrowers are allowed to get a line of credit which sums up to an amount that is equal to the property value. But the hurricane victims having lost their mortgaged property, it is uncertain as to whether they will get the entire loan amount. The situation may be better for those who have insured their homes. In such cases, borrowers can avail the cash. But if you do not agree to take on the remaining loan advance in spite of your property being insured, then you will have to pay back the principal along with interest.
On the other hand, victims having neither flood insurance nor homeowners insurance are doubtful regarding their further course of action. Even experts right now fail to predict what initiative HUD will be taking for the senior citizens. A number of loan servicers are right now continuing to pay the loan proceeds to the borrowers who have made the following insurance policies:
- Homeowners insurance and hazard insurance
- Flood insurance
- HUD insurance paid by borrowers as a part of the loan amount.
Officials of the Standard Mortgage Corporation based in New Orleans estimate that about 25% of the 1000 reverse mortgages have been made without any sort of insurance coverage. But some companies have decided to demand payments from those persons who have neither any insurance nor government aid. Others have decided to sell off the real estate of borrowers if they fail to pay off the mortgage. They also expect HUD to pay for the remaining amount.
Experts however anticipate that after the Katrina disaster, mortgage companies and lenders may be more lenient and may offer reverse mortgages to the affected victims for home purchase and home improvement. HUD is yet to approve reverse mortgages that can be offered for the purpose of home purchase. It is also expected to waive the limit of the HUD reverse mortgage provided for home repairs. Even the Congress is expected to remove the 250,000 cap on the number of reverse mortgages that HUD can possibly offer. This might help the Katrina victims to some extent as they can atleast have the opportunity of proper housing.
Hi guys,
I got some information on texas reverse mortgage.
The Texas constitution is likely to go through an amendment regarding the expansion of reverse mortgage options for seniors but the change will depend mostly on the Texas voters. Although the law till now allows reverse mortgage deals, yet there are restrictions such as single large payments or multiple payments of equal amount at periodic intervals.
The amendment will allow seniors to receive reverse mortgage loan amount through a line of credit. This will help them receive the money only when required instead of a lump sum or with respect to a predetermined scheduled. Under the new law, borrowers will also be able to repay advanced amounts.
I hope this will help others.
Thanks
I got some information on texas reverse mortgage.
The Texas constitution is likely to go through an amendment regarding the expansion of reverse mortgage options for seniors but the change will depend mostly on the Texas voters. Although the law till now allows reverse mortgage deals, yet there are restrictions such as single large payments or multiple payments of equal amount at periodic intervals.
The amendment will allow seniors to receive reverse mortgage loan amount through a line of credit. This will help them receive the money only when required instead of a lump sum or with respect to a predetermined scheduled. Under the new law, borrowers will also be able to repay advanced amounts.
I hope this will help others.
Thanks
Hi Shelley
Just to add something more to your information.
In order to discourage the use of creditline advances on reverse mortgages for unnecessary expenses, the Texas constitutional amendment includes provisions not allowing borrowers from getting advances through credit card, debit card, preprinted solicitation check or some other ways.
Thanks
Ralph
Just to add something more to your information.
In order to discourage the use of creditline advances on reverse mortgages for unnecessary expenses, the Texas constitutional amendment includes provisions not allowing borrowers from getting advances through credit card, debit card, preprinted solicitation check or some other ways.
Thanks
Ralph
Hi Ralph,
I thank you on behalf of our community for those additional information.
I shall feel glad if you participate with us and share your thoughts and knowledge.
God bless you.
For MortgageFit,
Samantha
I thank you on behalf of our community for those additional information.
I shall feel glad if you participate with us and share your thoughts and knowledge.
God bless you.
For MortgageFit,
Samantha
Hi!
I was able to find more information on texas reverse mortagage. Texas is the only state that till now does not allow a line of credit form of reverse mortgage. But with changes to the law, borrowers can receive the money only when required and pay it back when he is able to do so.
The amendment provides protections to limit the costs of borrowing, to limit the unnecessary use of loan advances and also to prevent lenders from changing the terms of the reverse mortgage. The amendment also allows a borrower to have the repaid amounts advanced later on to satisfy his needs in future.
Hope this will help further.
Thanks.
I was able to find more information on texas reverse mortagage. Texas is the only state that till now does not allow a line of credit form of reverse mortgage. But with changes to the law, borrowers can receive the money only when required and pay it back when he is able to do so.
The amendment provides protections to limit the costs of borrowing, to limit the unnecessary use of loan advances and also to prevent lenders from changing the terms of the reverse mortgage. The amendment also allows a borrower to have the repaid amounts advanced later on to satisfy his needs in future.
Hope this will help further.
Thanks.