Reverse Mortgage Lenders Honolulu

hawaii reverse mortgage

Reverse Mortgage Hawaii Information

A reverse mortgage is unlike any other mortgage option available in the market. In most loan situations, you must make payments to your lender in exchange for the use of funds. With a reverse mortgage, your lender makes payments to you, and you can spend the funds you receive any way you need to. Reverse mortgages in Hawaii are commonly used by seniors to pay for day to day living expenses.

With a reverse mortgage, your lender takes ownership of the equity in your home and provides this equity to you as cash that you can live on. This money can help pay for medical expenses, vacations, a down payment on a new home, debt obligations, or any other bills. There are many ways to use your home equity for financial success, though. Make sure you gather as much reverse mortgage information as you can before making a final decision.

If you do decide to pursue this income source, you can customize your equity payout arrangement to meet your personal needs. Your lender can deliver the money to you in any of the following ways.

  • As an established payment amount each month. This is the most common method. It provides you with a steady stream of income.
  • In full, as a lump sum payment immediately upon the close of the loan transaction. This method is best if you plan to downsize into a new home or wish to pursue other investment opportunities.
  • As a line of credit that you can access at any time. This method is best if your expenses tend to vary widely and a steady stream of income wouldn’t suit your needs.

You can also combine any of the above arrangements to create a completely flexible payout method.

Your lender will obtain ownership of your home equity. But don’t let this alarm you. Your lender does not gain ownership of your home during or after a reverse mortgage. You can continue living in your home without paying anything back to your lender until the day you pass away or decide to move out.

Upon your death, your heirs will receive ownership of the home. They will also inherit the responsibility of paying off your reverse mortgage. Most of the time, your heirs will sell the home and pay off the mortgage with the proceeds. If the property decreases in value such that the sale price of the home is less than your total outstanding loan amount, don’t worry. Federal regulations prevent lenders from collecting more than what the home is worth. In this situation, the lender must simply suffer a loss. Your heirs won’t see a penny of your debt beyond the value of the home that you leave to them. A reverse mortgage can ensure that you remain financially independent.

Hawaii Reverse Mortgage Lenders

Once you’ve decided to take out a reverse mortgage, the most important thing to consider is the lender you’ll work with. Every lender is different. Each one offers different rates and requires different fees. Contact as many lenders in your area of Hawaii as possible and find out what rates and terms they provide.

Reverse mortgage fees can get expensive. It’s critical that you find a lender who won’t charge more than what’s fair. For further information on what to expect when applying, read our reverse mortgage checklist.

Back-up plan: reverse mortgages can help folks afford retirement, but are they a good offering for insurers with banks?(Life: Reverse Mortgages)(Statistical table): An article from: Best's Review
Book (A.M. Best Company, Inc.)

3 to 5 year minimum

2009-01-31 11:30:30 by RM_Guy

If you are considering a reverse mortgage, plan on staying in the home for at least 3 to 5 years. I do not advise a shorter time period. The longer you have a reverse mortgage the less expensive the closing costs become. This is because you spread the costs over a greater number of years, thus lowering the annual costs.
In this respect they are similar to a "forward" mortgage. You would not get a 30 year forward mortgage if you knew you were leaving the home in 2 years, too expensive.
There are no "points" in a reverse mortgage. HUD does not allow such deception in reverse mortgages

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  • Avatar Scott B IndyMac owns Financial Freedom. Is it still safe to get a reverse mortgage with Financial Freedom?
    Jul 19, 2008 by Scott B | Posted in Personal Finance

    We are in the process of signing papers with Financial Freedom but I worry about them since the government seized their parent company IndyMac Bank. They say they can still make loans, but I worry if they will be able to continue the monthly payments. If I went with them, could I transfer to another lender at a later time?

    • I am told Financial Freedom is OK. If you did want to switch at a later date, you would have fees to pay. I have used Financial Freedom, but prefer Bank of America. We have wholesale account with both of them, as well as with JB Nutter.