Comments on: Generation Responds To Consumer Reports Reverse Mortgage Article

By: Max

Max — Mon, 23 Feb 2009 17:39:56 +0000

It is a shame that Consumer Reports as savvy as they are make such a huge error in judging the reverse mortgage loans, which in many cases is the only viable help for millions of struggling seniors.

By: mr reverse

mr reverse — Sun, 22 Feb 2009 04:05:08 +0000

How about our hungry banks giving us a bad name with higher margins even though they are borrowing money paying low interest rates to borrow and gurantee their money and now they have increaesd margins from one time of 100 to now 325 and looking at 350. so when raates go back to 5 and 6% and7% we will see 8.50% and 9.50% and 10.50% rates and higher. which brokers will say don’t worry you will not have to pay it till you die. What if I senior wants to move and use some of the equity left to be near their family but with higher interest rates thier will be no equity left.We will be no better then forward mortgage brokers with the option arms and interest only loans and negative interest loans. I for one am a shamed what my industry has come to. We give loans to 80 year old people with thier families living with the and we promised then that they will be able to stay in the hom after their parents die only to find out financil planners have sold them investments that are no longer worth any thing or is dow a lot. and with the higher intrest rates they owe more that home is worth. We tell them they will never owe more than the home is worth 1/2 truth they are not responsable but if they want to keep the home they have to pay off the loa which can be much more than the home is worth some times.
Lets get Our President to lower these margins now.we can have the loans modified!!!!!!!!!

By: nancy hofvendahl

nancy hofvendahl — Sat, 21 Feb 2009 19:48:42 +0000

Consumer Reports should have compared the cost of a reverse mortgage to the conventional neg am loans at the exorbitant interest rates they charged, where they lent borrowers 80% to 90% of their equity with no regard for their ability to make that monthly payment. The result of this irresponsible lending is the millions of borrowers that no longer have any equity and are either in foreclosure or have lost their homes to foreclosure. These high loan balance loans were provided to an enormous percentage of the senior population, who can’t make these payments. Unfortunately these seniors are unable to eliminate their mortgage payments because the amount they would receive from a reverse mortgage, will not even come close to the reverse mortgage loan amount available to them.

Although reverse mortgages are also neg am, the product structure restricts the amount of available equity to be encumbered, unlike the millions of loans that were structured for financial benefit of others, with no concern about the borrowers retained equity.

Our company has begun to experience the backlash. Borrowers who were interested in moving forward with their reverse mortgage, now have serious concerns about their decision. Thanks to the Consumer Reports prejudicial article containing inaccuracies and definately excluded objectivity, many lenders will receive similiar hesitations from potential borrowers.

I hope that each of the CEOs of the largest reverse mortgage lenders, NRMLA and those Senators that understand the benefits of reverse mortgages will write response letters to Consumer Reports. The honest thing for Consumer Reports to do, is to publish some of the excerpts from the letters. I have a sense though, that Consumer Reports will not be willing to do so.

By: Mark Draper

Mark Draper — Sat, 21 Feb 2009 15:43:51 +0000

I want to applaud Mr. Joe Morris & Mr. Dennis Haber for standing up for our industry, NARML should comment. When I read about these articles my first thoughts are here we go again, fear tactics to sell their rag. But the ignorance out there is huge on all levels, which just gives us more opportunity to correct it and be successful doing it, and of course be very ethical in going about our business.

An example of the ignorance that I came across recently was very interesting. I had a client who told me that his financial planer told him he would not qualify for a reverse because his house had to be worth $250,000 it was worth $150,000 and he was free & clear and old enough.

I know every one who has been doing this for a while has stories like this and probably more outrageous. Again thank you for speaking up. Remember its only worth doing if you do it in reverse.