Reverse-Mortgage-Truth.com

Jumbo Reverse Mortgages:
Financial Freedom Cash Account Advantage Reverse Mortgage: 6.39% (Index is 6 month LIBOR at 2.89% plus margin of 3.5%)
Bank of America Independence Plan Reverse Mortgage: Suspended

FHA Reverse Mortgages:
FHA Home Equity Conversion Mortgage (HECM) rate: 3.57% (Index is the 1 Year CMT at 2.07% plus a margin of 1.5%)
FHA Fixed rate HECM Reverse Mortgage: 6.06% to 6.40% (depending on the bank)

Interest rates do not account for closing costs and are not APR’s. Contact a lender for a reverse mortgage quote.

This is the final post in a series.

Most of the time costs associated with the option ARM are greater than those for a reverse mortgage. The closing costs tend to be similar amounts, but the interest rates on option ARMs average about 1% higher. Far more costly is the fact that you must cash out all the money at once from an option ARM rather than being able to take it out of a line of credit on an as-needed basis. The line of credit allows the loan interest to accrue more slowly since you keep the mortgage balance lower for a longer period of time, so that the loan interest accrues against a smaller balance. The option ARM only partially offsets this factor in that the homeowner pays a portion of the interest each month.

Common wisdom would indicate that seniors should look before they leap into an option ARM. It is really designed for working people who are willing to trade some of their equity for the privilege of freeing up some monthly cash flow for a period of time. But reverse mortgages for seniors are a far better choice in most cases.

Proprietary Reverse Mortgages:

Financial Freedom Cash Account Advantage reverse mortgage: 6.37% (Index is 6 month LIBOR at 2.87% plus margin of 3.5%)

Bank of American Independence Plan 210 reverse mortgage and Independence Plan 360: Bank of America has suspended their proprietary reverse mortgage program.

FHA HECM Reverse Mortgage rate: 3.43% (Index is the 1 Year CMT at 1.93% plus a margin of 1.5%)

FHA Fixed rate Reverse Mortgage - HECM: 6.7% to 6.81%

These are interest rates, not APR’s and do not include closing costs. A full reverse mortgage quote can be found here.

Over the past 5 years reverse mortgages in California have grown into an accessible and increasingly popular way for seniors to increase their financial means during retirement. Across all areas of California seniors have utilized reverse mortgage programs to accomplish worthwhile purposes such as ridding themselves of their mortgage payment by paying off existing mortgage debt; to make improvements to their home or cover maintenance expenses with a lump sum of cash; to enjoy a more comfortable lifestyle by increasing their monthly stream of income. Seniors have found practically endless uses for the additional funds from a reverse mortgage.

The minimal requirements for reverse mortgages in California have made them relatively easy to obtain. Seniors need only adequate equity in their home to qualify – credit scores, income and other assets do not matter. However, due to declines in the real estate market this past year seniors in some parts of California no longer have the certainty of adequate equity in their homes. As the real estate market in California is now firmly established on a declining path, it is more difficult to qualify for a reverse mortgage because the amount of home equity that seniors have is diminishing. Some parts of the state, however, are faring better than others.

Next we'll focus on San Diego reverse mortgages.