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Home Equity
Loan Reverse
Mortgages-Wait Just a Minute!
I don't know about you but I cannot watch the tube or listen to the
radio (in the car) anymore without hearing an ad for a reverse
mortgage company that will cure all the ills you have.
No wonder. Reverse mortgages are one of the fastest growing markets
in lending in the country and….here's the good news most of their
potential customers are not even eligible yet- BABY BOOMERS
all 78 million of them will be eligible at age 62.
WHAT ARE REVERSE MORTGAGES? A reverse mortgage is a home equity loan
or line of credit that is secured by the equity in your home. You do
not repay as long as you live in the home. The reason it is called a
reverse mortgage is because it is the opposite of a regular home
equity loan where you reduce debt and build up equity. In a reverse
mortgage you reduce equity and build up debt. That is where the
money comes from.
WHO CAN USE REVERSE MORTGAGES? Basically anyone who is over
age 62, owns and lives in their own home and has paid off at least
60% of the loan can apply for a reverse mortgage. There is no proof
of income requirement.
One thing that is a marvel to me as a former economics minor, back
in the day, is how the marketplace works. Five years ago no one even
heard of a reverse mortgages. Two years ago folks greeted them with
much skepticism. Last year they grew at a stunning 77% for the
fiscal year ending 30 September, 2k6.
s
our market economy is designed, when the need/demand for products
grows so does the variety of offerings for that product. And the
competition will make the pricing more competitive. Reverse
mortgages are no different.
Several new products are slated to come out this year. More
competition means lower rates and fees. So if you are in the market
for a reverse mortgage WAIT JUST A MINUTE! Things are
heating up in the reverse mortgage market and you, the consumer, are
going to be the beneficiary. And with literally millions of
Americans fast approaching the magic age of 62 the marketplace will
continue to respond favorably.
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