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.
It wasn't long ago that consumers had three reverse mortgage products to choose from: the FHA HECM, the FANNIE MAE HOME KEEPER, and the JUMBO CASH ACCOUNT. Now, seven new lenders have introduced competing programs, with more large investors positioning to move into this growing market.
As well as these private sector programs, new multiple-margin HECM offerings are now available, as well as an FHA/HECM FIXED rate option. This fixed rate option is something that has been long awaited by many consumers. Now, it is finally available.
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.
Purchasing a second home is another exciting use for a reverse mortgage. With this option, seniors can finally have that dream home they have always wanted. This second home can now be acquired with no monthly payments by using a reverse mortgage. It is even possible to have 2 reverse mortgage loans at the same time. You can have one on your existing home and one on your second home both with no payments!
Please make sure you have a good understanding and confidence in the process of getting a reverse mortgage. There are many different concepts and different terminologies that you may not have head of before. Also, not all lenders offer the same choice of products and many of them limit the choices of investors you can go with.
As a final note, please be advised that you should look for a lender that is approved by the National Association of Reverse Mortgage Lenders (NRMLA). Currently, this is the only organization that oversees the ethical conduct of those in this industry.
