Here is another reality check. The reality of today is that there are alot of seniors who have a 1st mortgage for about half the value of the home, or less, and a 2nd mortgage for the remaining equity.
Unfortunately, these seniors are seeing the interest rates on their second mortgage jump by more than a few points and many of them cannot afford the increase in monthly payments because they are on a fixed income. The equity loans sounded good at the time, but the loan officers were not being honest with the senior about the impact of an increased interest rate. So today, when they go back to the bank to try to refinance, they are caught in an awful trap. The value of the home has dropped, and the bank will not refinance the home.
Here is what the seniors need to know. Get the bank to subordinate the 2nd mortgage and get a reverse on the 1st mortgage. This way the senior will have manageable payments (since they are only paying on the second mortgage). Depending on the LTV of the 1st mortgage, the senior may even be able to put a couple dollars in the credit line or in cash in their pocket.
This is a difficult process since you need to educate the bank about the process. You should only have someone who is highly educated in reverse mortgage conduct this process on your behalf.
We have that education and experience. If you are caught in this situation, give us a call.
Bob
bob@az62.com
www.az62.com
888-277-4990
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