Posted by ME/NJ on 3/27/13 12:34pm
Msg #463330

RM Apps and loans way up since 01/13

I get maybe 1-2 a month, since the start of the year I am doing 6-10 month now. Shows how hard economic times are.

Reply by Beverly Kinlaw on 3/27/13 1:04pm
Msg #463343

also apparently the percentage of equity that will be loaned is decreasing significantly sometime in the spring - per the RM loan officer I work with. so there is a push for RM app etc right now.

Reply by MW/VA on 3/27/13 1:10pm
Msg #463346

I used to get requests for RM's, but I haven't seen many

lately. I did hear a while back that the criteria was changing, and the "non-qualifying" aspect would be disappearing. Also, I wouldn't suppose to link RM's with hard economic times. It's a financial strategy, IMO.

Reply by Linda_H/FL on 3/27/13 1:56pm
Msg #463354

A LO that I do RM signings for said that as of 4/1/2013

there are going to be sweeping changes in the program that are going to end up costing the borrower thousands more; one thing he said is the fixed-rate is going by the wayside....they'll all be variable.

Reply by MW/VA on 3/27/13 2:04pm
Msg #463355

Re: A LO that I do RM signings for said that as of 4/1/2013

I'm sure you're glad you got yours done before those changes! ;-)

Reply by ME/NJ on 3/27/13 2:15pm
Msg #463357

Between FHA and RM loans as 4/1

Big changes and like I posted months ago you will see a major slow down by end of 2013. Just hope it does not get as bad as 2009.

I bet most of the changes are forced by the government to help cover the trillions of dollars of debt we have.

Reply by JanetK_CA on 3/27/13 3:51pm
Msg #463369

Re: Between FHA and RM loans as 4/1

"Big changes and like I posted months ago you will see a major slow down by end of 2013. Just hope it does not get as bad as 2009."

I think that when interest rates start going up we could eventually see a slowdown greater than 2009. However, before that happens, there may be a significant short term burst, if there are a lot of people with ARMs who decide that it's finally time to lock in. That will depend on how many of them who could actually qualify for a loan have already refinanced to lock in a fixed rate. And I suppose it's possible that that burst has already happened over the past year or so.

Long term, I expect lenders to try to get creative to drum up more business, but I think it's going to get a lot tougher as the economy improves - although hopefully that will allow more people to qualify for loans who couldn't before. Maybe that will keep things going well enough in the meantime, but I'm not very bullish long term.

Reply by Shoshana/AZ on 3/27/13 2:19pm
Msg #463359

The non qualifying aspect is not disappearing.

That would defeat the whole purpose. Many older people have low incomes and could not qualify.

Reply by Shoshana/AZ on 3/27/13 2:16pm
Msg #463358

The fixed rate is being suspended for now.

It's possible they may come back. The reason is that FHA is assuming that people are spending their money rather than saving it. We need to refi our RM. However, real estate in Phoenix Metro is appreciating at the rate of about 1% a week according to my realtor. So, we are waiting a while. They could have squeezed us in before the 4/1. We said no.

Reply by Bear900/CA on 3/27/13 7:39pm
Msg #463417

More about RM's

Using my best to stay away from acronyms and keep this simple without pie ...

Reverse Mortgages have what they call a Standard, a Saver and an ARM.

The differences?

In the Standard (fixed rate), the loan origination fees are paid for by the lender rebate. That means more cash to the customer. The FHA upfront premium is the “standard” FHA amount. It goes bye-bye April 1st.

The Saver (fixed and adjustable) provides less cash, the customer pays the loan origination fee, but the FHA upfront premium is minimal so it “Saves” the customer from needing to pay out of funds a larger upfront FHA premium.

The ARM still exists in the form you may recognize as monthly cash payments and lines of credit.

There is really no need to fret about the stability of RM’s. When the program started, all they had was ARMs. We just got used to that nice lump sum in the standard fixed rate.

Why did they put the fixed fate standard on hold (as we like to say)? FHA is about $16 Billion in the hole. It goes without saying that guaranteeing the larger lump sum is riskier.

There are no other major “sweeping changes” even though you see headlines as such. Qualifying is the same except there is more of an effort to make sure that seniors have enough funds to pay their taxes and insurance so they won’t default.