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Archive for February, 2009

Time to stop the “blame game”…

Accusations have gone ‘round more than twisters in Oklahoma in the Spring time.  With plenty of blame no matter which way one points one thing is certain… we are where we are.  The Stock Market is in the tank, the Real Estate market has gone through far more than the “correction” that experts told us we were dealing with two years ago.  And the Banks… well, true, money has gotten tighter, but the real issue is that lenders got burned with lending to people who they knew going in had higher probabilities of defaulting… and to no one’s surprise, they did.  There is still plenty of money to borrow, but if you don’t have high credit and good income your options have vanished.

And what are we to do?  Well, as someone who as seen just about all that this economy can dish out after 50 years, Mr. Nicholas Caputo, retired President of Bank of America’s Trust division and former Vice President of Chase Bancorp tells us “…we’ve been through tough times before. Our salvation isn’t going to come from our leaders, it’s going to come from the same place that it has always come from, the strength and resolve of the American people themselves.”

And he’s probably right… let’s hope he’s right, the alternative isn’t a pleasant one.  But with every challenge comes the opportunity to learn.  We as a people are a nation of “non quitters”, of stumblers and fumblers who’s only difference between their success and other’s failures is that they simply did what it took, they picked themselves up yet again, they persevered, and they overcame.  We shall overcome…

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Can it get any better for the FHA HECM?

That is the question many in the mortgage industry, and many senior homeowners, are asking these days. After 20 years of near obscurity the FHA Home Equity Conversion Mortgage seems to be finally getting the due so well deserved.   Not the first choice for advertising budgets spent by mortgage lenders looking to maximize return on marketing dollars, and slow to shed the mantle of derision brought about by abuse of reverse mortgages of days gone bye, perhaps the stars have finally aligned for the safest mortgage in America today.

We are at a unique period in time where the awareness of the Government version of the Reverse Mortgage is at it’s highest.  Combine that increased visibility with a dramatic decrease in financial stability and you find that environment for a “perfect storm” of sorts, but instead of a storm senior homeowners today are finding a safe port in these unsettling financial times.

Also contributing to the growth in the FHA HECM are the recent passing of the Home and Economic Security Act of 2008 which brought with it an increase in the FHA lending limit to $417,000.00 and the limiting of certain fees charged the borrower.  And the current administration has leant this program a hand as well, the Stimulus Plan just signed by President Obama further raises the FHA lending limit to a new height of $625,500.00, great news for that select group of homeowners that have seen some of the most dramatic gains in home appreciation over the past few years.  As well with gains in property tax that quite sadly has lead many in this situation to sell their beloved homes because with their limited income in retirement, even with planning, they simply find it difficult if not impossible to keep up.

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