Reverse Mortgage News: Financial Assessment Begins March 2nd, 2015

Much speculation about the date of the implementation the financial assessment by the FHA has been circulating for some time, but recently, there has been huge updates to the reverse mortgage programs coming soon! Beginning March 2nd, 2015, the reverse mortgage industry will adopt new guidelines that will affect the qualification process for potential borrowers. Reverse mortgage companies will begin doing a borrower financial assessment similar to underwriting checks similar to regular mortgages. Previously, borrowers were not required to undergo a financial assessment, but it will now be a part of the process to determine whether or not the borrowers are required to have a life expectancy set aside.

The financial assessment will go over the following information:

• Credit reports.

• Financial earnings, including part-time and regular employment, Social Security, pension, etc.

• Payment history on property taxes, HOA fees and hazard insurance premiums.

• Recurring debt obligations such as credit cards or medical bills.

The financial assessment will be an addition to the other qualifications required for those who are looking to do a reverse mortgage:

• Borrowers must own and live in the home in question.

• At least one of the borrowers must be at least 62 years old.

• Attend a reverse mortgage counseling session.

The borrower financial assessment will go into full effect by March 2nd, 2015. While these new changes can be seen as a stricter addition to the current qualification process, reverse mortgages continue to be a resource for seniors who are looking for an extra cash flow. With a reverse mortgage, borrowers do not have to worry about making a monthly payment on their loan, and continue to live in their home for as long as they want.  For information on reverse mortgages, contact a Senior Advisor at 1-888-808-8486.