Senior homeowners who want to cash out equity with a reverse mortgage will have to play by new rules when applying for a loan after the end of this month.
The FHA is changing the rules for lump-sum payouts.
Reverse mortgages, available to homeowners age 62 and older, are more appealing to younger borrowers than they were a decade ago, according to a study by MetLife Mature Market Institute. This type of mortgage allows homeowners to borrow against their home equity and receive cash without any payments on the loan being due until the borrower
When home values were going up like a rocket, lenders often marketed reverse mortgages as a gateway to financial freedom. Now, some of them want out. Wells Fargo says it will stop offering reverse mortgages as of June 30. Bank of America stopped offering them in February. The two lenders accounted for about half of
Here’s a potential new retirement planning option that could be worth considering. John K. Lunde, president of Reverse Market Insight Inc., says the reverse mortgage business was off 40 percent in the first half of the year compared to the same period in 2009, but he thinks sales are going to pick up after Oct.