The first baby boomers turn 62 as of January 2008. Because of this, many investors are scurrying to come up with new, innovative products to offer to the incredibly fast growing reverse mortgage market.
In days gone bay, consumers only had three reverse mortgage offers to choose from: 1. the FANNIE MAE HOME KEEPER, 2. the FHA HECM, and 3. JUMBO CASH ACCOUNT. Now that there is a booming market, seven new lenders that are now making available competing programs. And there are even more investors entering into this market.
In addition to these private sector programs, new multiple-margin HECM products have been introduced, as well as an FHA/HECM FIXED rate option. Many consumers have long awaited the option of having a fixed rate, and at last it is here.
In just the past six months (January thru June 2007) the reverse mortgage business has witnessed a rapid evolution not seen in over 17 years of existence. The reverse mortgage industry is finally beginning to mirror the traditional “forward” mortgage market, as we see more lenders launching a wider variety of products and pricing options designed to fit the needs of our senior customers.
One of the most exciting new products available today is the new “Purchase Reverse Loan”. This product is available to seniors who are in the market to either purchase a new home, to down size, or relocate close to family. The ability to use a reverse mortgage to purchase a new property while never having to make a mortgage payment is VERY appealing to all seniors.
Another exciting new product, is the use of a reverse mortgage to purchase a second home. Many seniors would love to have the option to have that summer home in the mountains, or that winter home in Arizona. Now, you can, payment free for life, with the use of a reverse mortgage. You can even, have two reverse loans at the same time, one on your existing home, and one on your vacation home. Imagine two homes, no payments!
Because of all the new program concepts, and terminology, it is advised that you have a complete understanding and confidence in the reverse mortgage process. Not all lenders have the same variety of products, and many have only a few choices of investors.
Please make sure you look for a lender who is part of the National Association of Reverse Mortgage Lenders (NRMLA). This association is presently the only overseer of the ethical conduct of reverse mortgage lenders.
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