Why We Need To Understand Reverse Mortgage?

Reverse mortgage are the best choice for the seniors and when they get retired. Also many seniors who get reverse mortgages do not fully understand the terms of the loan until it's too late. Like stated income loans, reverse mortgages have a great potential for abuse. Loan officers, who make a commission for every loan they close, often concentrate on how a borrower can qualify and why they should get the loan, rather than on whether a reverse mortgage is the best tools to meet the customer's needs. For this reason, counseling is required for seniors considering one. Lenders must provide potential borrowers a list of at least five HUD-approved counseling agencies. The Department of Housing & Urban Development requires that they counselors review the borrower's finances, help them make a budget and discuss alternatives to a reverse mortgage. The cost of the counseling is up to $125. Counseling is offered for free to those who cannot afford it. Sounds good, right? The trouble starts with the lender compiling a list of local counseling agencies. Lenders shop for counseling agencies that will do as little as possible, preferably over the phone. A counselor who would advise a borrower, any borrower against getting a reverse mortgage is unlikely to end up on the any lender's list. The Government Accountability Office used undercover investigators to check up on some of these counselors. In 14 out of 15 cases, the counselor failed to fully explain the financial implications of a reverse mortgage. Seven of the 15 failed to discuss alternatives to a reverse mortgage. So, while considering a reverse mortgage you should be fully equipped with reverse mortgage information and know about the good lenders. It would not only be a great assistance to you for identifying the loan implications but also to approach to the best lender in the market.