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Old 04-29-2013, 08:01 AM   #1
fatlazyless
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Default ...no well....no foundation...no reverse mortgage!

Turning 62 later on this year, I have been thinking about trying out the reverse mortgage route, so I phone up a loan specialist from the Meredith Village Savings and had a brief conversation with her. Immediately, not having either a foundation under the cottage or a well for water, both raised red flags making a rev-mort a no-go.....and she mentioned that she knew of applicants who had a well drilled just for this reason.

So.....what to do.....the property tax is obviously never getting smaller....and looms large forever looking forward.....and a rev-mort would probably be just the ticket for me! What-to-do?
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Old 04-29-2013, 08:24 AM   #2
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Turning 62 later on this year, I have been thinking about trying out the reverse mortgage route, so I phone up a loan specialist from the Meredith Village Savings and had a brief conversation with her. Immediately, not having either a foundation under the cottage or a well for water, both raised red flags making a rev-mort a no-go.....and she mentioned that she knew of applicants who had a well drilled just for this reason.

So.....what to do.....the property tax is obviously never getting smaller....and looms large forever looking forward.....and a rev-mort would probably be just the ticket for me! What-to-do?
I think they are looking for greaters at WAL-mart (it is on you side of the lake)
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Old 04-29-2013, 08:30 AM   #3
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Do you plan on leaving the property to anybody in your family upon your death?
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Old 04-29-2013, 09:12 AM   #4
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you understand that in a reverse mortgage you are required to continue to maintain the property and keep the taxes current . I wasn't sure from your comment . They are designed more for a primary residence
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Old 04-29-2013, 09:27 AM   #5
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We had the same kind of problem with parents in FL. Many rules and requirements for a reverse mortgage. Some we could not meet.

We ended up getting a credit line secured against the property. You just write a check when you need the money. The down side is you can't get at as much of the equity.
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Old 04-29-2013, 09:30 AM   #6
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Do you plan on leaving the property to anybody in your family upon your death?
I plan on staying there as a primary residence till I am at least 102?
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Old 04-29-2013, 09:38 AM   #7
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K....never mind.
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Old 04-29-2013, 09:57 AM   #8
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Many young borrowers are taking out reverse mortgages for the wrong reasons—not to live out their final year in comfort in their family home but because they need cash. These people are the "Leading edge baby boomers, aged 62 to 64", according to Forbes on-line.

Did you know that Reverse mortgages are so complicated that would-be borrowers have to go through counseling (mandated by Congress) before hocking their house.
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Old 04-29-2013, 10:03 AM   #9
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Unhappy Mortgage Crackdown

I knew of a lakefront property owner that has property free and clear of any mortgage. She wanted to retire and winterize the cottage. I can't believe the mortgage companies will not give her an improvement loan because she has no cellar or artesian well! Over a decade ago I was able to secure an improvement loan on a similar building, which has been paid off. The banks kind of said they were cracking down on 'substandard structures'? I know of a number of cottages on the lake that fits this category. Does anyone know how to get around this rule?
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Old 04-29-2013, 11:10 AM   #10
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I knew of a lakefront property owner that has property free and clear of any mortgage. She wanted to retire and winterize the cottage. I can't believe the mortgage companies will not give her an improvement loan because she has no cellar or artesian well! Over a decade ago I was able to secure an improvement loan on a similar building, which has been paid off. The banks kind of said they were cracking down on 'substandard structures'? I know of a number of cottages on the lake that fits this category. Does anyone know how to get around this rule?
Local banks are usually the best for these i would think, I know when searching a while ago for other things that the local banks had the best knowledge on these types of issued
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Old 04-29-2013, 12:53 PM   #11
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Local banks are usually the best for these i would think, I know when searching a while ago for other things that the local banks had the best knowledge on these types of issued
Given the current economic state, I don't even think local banks are able to be as flexible with their lending policies.

The bottom line is we are in a depression. And right now borrowing money is hard to do, if things are anything but pristine.
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Old 04-30-2013, 01:54 AM   #12
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http://www.forbes.com/sites/.../03/....ep-by-boomers/

....dang it...this link is not working....it gets defaulted in the translation or something....boo-hoo!

"The reality: there are rising defaults where homeowners can't keep up with their property taxes."

If you google "Leading edge baby boomers, age 62-64. Forbes" the first item should be the correct article in Forbes Magazine, March 19, 2012.

... an informative link included at the bottom of the Forbes article..... http://www.hud.gov/buying/rvrsmort.cfm

I was told by the Meredith Village Savings reverse mortgage specialist that reverse mortgages are a HUD product that is limited to a maximum $625,000 and is based on the value of the house, and not on the land. Too, too bad that I do not just get property-taxed on the house exclusive of the small lot of waterfront land! .....
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Old 04-30-2013, 07:32 AM   #13
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Really no basement and no well = No reverse Mortgage? What do the people in Arizona or Cali do? I know lots and lots of people out there that have town water and are on a slab. Pretty much every house out there is on a slab. Where my Condo (Small house we own, land we do not.) is in Nashua many are on slab. I am lucky to have a full basement, but most do not. We are all on town water down there. I don't get it???????
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Old 04-30-2013, 08:46 AM   #14
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Really no basement and no well = No reverse Mortgage? What do the people in Arizona or Cali do? I know lots and lots of people out there that have town water and are on a slab. Pretty much every house out there is on a slab. Where my Condo (Small house we own, land we do not.) is in Nashua many are on slab. I am lucky to have a full basement, but most do not. We are all on town water down there. I don't get it???????
For purposes of a reverse mortgage, town/city water is as good as a well, and a slab is as good as a foundation (basement or crawl space). The problem, as FLL has discovered, is when you have neither a well nor town water, and neither a foundation nor a slab.
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Old 04-30-2013, 09:15 AM   #15
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Really no basement and no well = No reverse Mortgage? What do the people in Arizona or Cali do? I know lots and lots of people out there that have town water and are on a slab. Pretty much every house out there is on a slab. Where my Condo (Small house we own, land we do not.) is in Nashua many are on slab. I am lucky to have a full basement, but most do not. We are all on town water down there. I don't get it???????
The difference here is FLL's home is more of a camp style, probably on sonotubes and draws water from the lake.
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Old 04-30-2013, 07:17 PM   #16
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Reverse mortgages are a tremendously bad idea.

FLL, in your case a typical home equity line of credit probably makes the most sense and will have the easiest underwriting requirements. Draw on the line of credit as needed and just keep paying interest only on any outstanding balance, roll over the principal to a new HELOC when necessary (typically 5, 10 or 15 years) and then the balance will be paid off when your house is eventually sold.
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Old 04-30-2013, 07:32 PM   #17
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Reverse mortgages are a tremendously bad idea.......
I think his goal is to get all the $$ out of his house paid for by the bank, live in it free until he is 102 years old, meanwhile the town will supply free fillings while he is getting 90 day free rentals on pumps from Walmart .....
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Old 04-30-2013, 07:50 PM   #18
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I think his goal is to get all the $$ out of his house paid for by the bank, live in it free until he is 102 years old, meanwhile the town will supply free fillings while he is getting 90 day free rentals on pumps from Walmart .....
I thought the pump was from Lowes or Home Depot
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Old 05-04-2013, 02:54 PM   #19
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Helped my elderly parents into a reverse mortgage a few years ago near the peak in house values. As I now unwind the transaction on selling the house a few observations.

I don't think Mom and Dad ever really understood how it really worked.

It was a good thing for them as they got to spend $150K on themselves and their expenses.

The variable interest rate is really low right now. I think just below 1%. Obviously could have gone the other way.

The fees getting in are obscene. More like an insurance policy against a bad guarantee by the feds.

Not for everyone but it worked for them when they were at home.
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Old 05-06-2013, 03:14 PM   #20
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reverse works well for some people, my parents used it to buy there retirement home so they could have money for other things and IMO they owe me nothing when they pass so live it up. fees are pricey for sure. As far as the foundation and water FHA is guaranteeing jsut about all reverses if not all of them and they have higher property standards on certain things. Slab fine, crawlspace with concrete blcok walls fine, post and peirs usually not fine.
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Old 05-08-2013, 06:00 AM   #21
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So how do you pay them back? Do you sign a note promising to pay when the property's sold? Is there a law or something about selling and paying the note back, like a timeframe or something? Can you take a reverse then leave the home to a child??
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Old 05-08-2013, 06:40 AM   #22
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So how do you pay them back? Do you sign a note promising to pay when the property's sold? Is there a law or something about selling and paying the note back, like a timeframe or something? Can you take a reverse then leave the home to a child??
I think the intent is to never pay it back, thus why it seems to be marketed to retired folk and the elderly. The banks gives you small loan payments (in reverse) instead of one large lump sum home equity loan. Then they own the house and could make a killing when they sell it after your death. If you want to leave it to a relative, they will have to pay off the mortgage or refiance. I'm a huge Dave Ramsey fan and he clearly explains why they are such a bad deal.

Banks didn't come up with this scheme to help YOU.
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Old 05-08-2013, 06:40 AM   #23
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If you just need access to money, try a home equity account. The interest can be a pain though. Make sure you don't fall behind in the payments because they can still take your house.

...And that's all I think I know about that.
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Old 05-08-2013, 08:23 PM   #24
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....say-hey....probably best to fuhgettabout a reverse mortgage and, I should rent out the cottage during the high-rent, summer weeks and move myself into my old, unregistered pickup truck.....someone up the road has an accessory one-room cottage on their lot as well as a large, old laker, waterfront house and does something like this to make money for his prop taxes......maybe become bad-arrhhggg homeless and go live under a bridge during the high-rent summer weeks and live on Pabst Blue Ribbon and cheese-its on a rainy day under the Weirs boardwalk with the big lake view!
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Old 05-09-2013, 01:57 AM   #25
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Sounds like a plan!!!!
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Old 05-09-2013, 04:12 AM   #26
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Unhappy Speaking as a Former Mortgage-Loan Officer...

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Reverse mortgages are a tremendously bad idea.
It's been working for a family member: they live high on the hog and never complain about their RV's guzzling of gas. They've even "sold" the idea to neighbors, who've thanked them for the suggestion. 'Course, they entered into their reverse mortgage before the recent collapse of the housing market. He's very industrious, and working all the angles that a US state can provide.

Today, banks are reverse mortgage "shy", but are fined millions by the government when they don't make loans. I'd fully expect banks to make reverse mortgages more difficult to get, but don't understand what happens to these reverse mortgages when the entire US banking system gets in even deeper trouble. (Think Wells-Fargo).

In the meantime, FLL could do the same as "toxic-loan" applicants—who are expected to tell the truth on their applications.

(And leave it at that).

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Old 05-09-2013, 06:08 AM   #27
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....oh well...but what the heck....did u know that both canada geese and mallard ducks totally love cheese-its.... www.cheezit.com ...plus a cheese-it travels through the air just like a frisbee and for a pretty good distance too! Apparently, an individual canada goose seems to get to recognize individual people, and it definitely likes to eat. There's this one large healthy canada goose http://en.wikipedia.org/wiki/Canada_Goose which has an aluminum band with a number on its left leg, who along with its female canada goose partner, "Canada & Trudy," keep coming back for cheese-its and cracked corn. Maybe they are feeding a nest of young canada geese and they regurgitate the cheese-its and cracked corn for their young?
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Old 05-09-2013, 06:47 AM   #28
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....oh well...but what the heck....did u know that both canada geese and mallard ducks totally love cheese-its....plus a cheese-it travels through the air just like a frisbee and for a pretty good distance too! Apparently, an individual canada goose seems to get to recognize individual people, and it definitely likes to eat. There's this one large healthy canada goose which has an aluminum band with a number on its left leg, who along with its female canada goose partner, "Canada & Trudy," keep coming back for cheese-its and cracked corn. Maybe they are feeding a nest of young canada geese and they regurgitate the cheese-its and cracked corn for their young?
Keep feedin' them Less, I'll send the 30 or so that attempt to visit me once in a while down the Walmart side of the lake to join them and you.
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Old 05-09-2013, 07:12 AM   #29
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...have thought about setting a bowl of Pabst Blue Ribbon along with the cracked corn out on the dock for Canada & Trudy, but my girlfriend says no, that's a bad idea because it could upset their metabolism...they just drink water right out of the lake...but I betcha they would really appreciate an ice cold beer on a hot hot day!
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Old 05-09-2013, 12:19 PM   #30
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Keep feedin' them Less, I'll send the 30 or so that attempt to visit me once in a while down the Walmart side of the lake to join them and you.
Yes, keep feedin' 'em. Less. We don't want them.
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Old 06-05-2013, 12:41 PM   #31
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http://finance.yahoo.com/news/revers...160546994.html
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Old 06-05-2013, 01:31 PM   #32
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I think the intent is to never pay it back, thus why it seems to be marketed to retired folk and the elderly. The banks gives you small loan payments (in reverse) instead of one large lump sum home equity loan. Then they own the house and could make a killing when they sell it after your death. If you want to leave it to a relative, they will have to pay off the mortgage or refiance. I'm a huge Dave Ramsey fan and he clearly explains why they are such a bad deal.

Banks didn't come up with this scheme to help YOU.
ramsey is far from the be all when it comes to this stuff. he's rather have you in no debt eating nothing but ramen noodles while your free and clear owned homes sitting there just so you cna say you have no mortgage.

Reverse can be a good thing, no payments made, house is sold after you dies with the payoff being the principal plus interest, you cna never owne more than it sells for and if it sells for 10x what you borrowed you cna get some proceeds from it.

Biggest opposer of a reverse mortgage is the kid who are mad they will get no inheritance yet don't want to pay for the parents expenses while they are alive.

My parents bought there retirement home with a reverse, they owe me nothing when they die IMO so having no first mortgage payment or home equity payment is just perfect for them. gives them another $1000/mo to spend having a good time.
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