Essay On Reverse Mortgage

In the United States we face many issues such as poverty, death, health, and many others. But the issue that is currently effecting society the most is foreclosure. What is foreclosure? How has it effected society?. The definition of foreclosure is a legal or professional proceeding held by a lien holder which is a court order termination of equitable right of redemption amongst housing properties. Foreclosure has not just effected us financially, but has effected society physically.

Although things may happen in the future, such as a medical crisis, that can impact the person's ability to repay the mortgage, this is true for anyone. Their focus now is on how much the person owes and if they are able to pay the bills they currently have on time before they add on a mortgage payment, repairs and maintenance of the home, homeowner association fees and more. A lot of responsibility comes with owning a home, and Mike and Brian work to ensure the borrower understands this responsibility.

It is evident that the housing deficit is just a layer of the many problems we are suffering from during the hard times in our economy. Foreclosure is indeed a horrific word that is haunting homeowners across the US. Because of the situation in the current economy, millions of Americans have been plagued by foreclosing on their homes and are left to find new location for themselves and their families to live.

In the gleeful times of 2005, my parents decided, like so many others, that it was time to “upgrade.” They sold our smaller home on the other side of town, which had appreciated nicely, and bought a 3700 square foot behemoth in a town with already exorbitant property taxes. My younger brother and I were thrilled to finally have a basement, our own rooms, and even a concrete basketball court in our backyard! All eight-year-old me knew was that things were going to be a whole lot more comfortable from there, and my optimistic parents seemed to think the same.

was August, and I was seven months behind on the mortgage. The house had now gone into foreclosure, and on the twenty-eighth, it was going to be auctioned. Despite what that letter said, I still trusted God to perform a miracle. That letter did not faze me a bit. My faith was solid, and nothing or any person was going to shake it. After all, I was following the direction of the Lord.

The foreclosure crisis that devastated our economy several years ago not only impacted the middle class wealth but also the upper class wealth. The upper class families who were not prepared for this crisishad to downsize their primary homes or utilize their investments and savings to keep their properties. The middle class families were hit the hardest during this crisis with losing there homes, depleting their life savings and investments. The middle class families who were forced to foreclose on their homes due to their loss of income and financial security moved into rental apartments or moved to a family members home to regroup from this crisis. Areas that may have added to foreclosures or short sales were the lost of many jobs due to a corporation downsizing of their employees, or the over appraising of a property if the property was appraised higher than the true value or what a buyer was willing to pay for the property. Homeowners were forced to sale their property at a lower price if the homeowner was in the process of a divorce, relocating for a job or foreclosing because they had fallen behind on their mortgage payments.I have seen circumstances where certain peoplelived above their means by spending more for a home or nonessential items like luxury vehicles they couldnot actually afford to pay.

mortgage was due, and I had not paid anything since they sent the check back to me in March. I received a letter stating that I had to send them both payments, or they would not accept it. I had believed that if I was sending them a payment, everything would be okay until I was able to catch up. When I sent February’s payment in March, the mortgage company sent the check back. I explained to them that I wasn’t two months behind because I had until the 15th of March to pay them. They would not work with me, and now I had a problem of needing at least another one thousand dollars to catch up with my mortgage payments.

The insolvency seen in the Housing Market manifested in the large number of stagnant foreclosures caused a dramatic decline in housing prices, which resulted in many homeowners owing more money on their houses than they are worth. Market-level insolvency is caused by capital flight in a specific market in response to a scare during a decrease in solvency. During the scope of this recession, the initial, progressive decrease in solvency was caused by a negative Net Capital Outflow in conjunction with the cash-vacuum produced by the US Budget Deficit, and the scare was caused primarily by the failure of several significantly-sized corporations and a rapid increase in foreclosures caused by the loss of a large number of jobs.

The Home Owners Loan Corporation was established in 1933 by Franklin D. Roosevelt to protect homeowners from foreclosure. Its purpose was to increase housing investments after the Great Depression when the values of homes were halved and the efforts of Herbert Hoover failed. The Home Owners Loan Corporation was able to refinance mortgages with loans from private lenders with federal backing. This federal backing gave private lenders the confidence of security. In order to determine who would get loans the Home Owner Loan Corporation developed the neighborhood rating system which would categorize and discriminate the value of neighborhoods based on race, ethnicity, age, and religion. There were four classes used to determine whether a neighborhood was a good, fair, risky, or bad investment. The colors were respectively green, blue, yellow, and red. To be considered a good investment, homeowners had to be white, Christian, and live in new housing. A fair investment consisted of the same type of people but in older housing. A risky investment would consist of older housing and homeowners who were black, Jews, or foreigners. A bad investment was considered

The foreclosure crisis in America has impacted everyone- even those who don’t own homes. Our nation is currently struggling with high unemployment, a relatively illiquid credit market, and a deficit that raises serious concerns about the value of the US Dollar in the not too distant future. With interest rates already at historic lows and the government pursuing an unprecedented policy of quantitative monetary easing, options for government intervention are limited. While there is no simple solution to this problem, I think that we must look at the reasons the housing market went into crisis, and based on that develop a regulatory system that will allow us to avoid another situation like this in the future. If Americans believe

2. Reverse Mortgage - Retirees remaining in their homes can still tap their home equity as a source of retirement income. An entire industry has grown up around the "reverse mortgage" concept which allows seniors over 62 to tap into their home 's value without making any repayments during their lifetime. A reverse mortgage (also known as a HECM - Home Equity Conversion Mortgage) requires no monthly payment. The payment stream is "reversed": instead of making monthly payments to a lender, a lender makes payments to you, typically for the remainder of your life, if you continue to reside in the home.

The fear of losing the equity in your house. Seniors grew up with the American dream of owning a house. They spent their lives focused on making their home free and clear of any liens. Paying off the mortgage was priority number one so it is counter-intuitive to add debt to it. By taking out a reverse mortgage you would be doing a 360 degree turn and actually be growing a mortgage versus paying it off. No matter how much sense a reverse mortgage may seem it will not make sense to a lot of seniors because of how they were financially raised.

The homeowner would also receive benefits if they chose to participate in the government’s program. Not only would the homeowner be able to stay in the house, but if they were to remain in the house until the house price appreciated past the value of the original mortgage, they would receive one third of the extra value of the home. Also, partial payment standard would only be applied to homeowners’ credit score during the loan is reconfiguration, and not during the payment of the adjusted mortgage. In short, homeowners would have the incentives as

Since the housing market bust, there has been an explosion in the number of federal investigation of mortgage fraud scheme across the country. Mortgage Fraud is a violation of state and

The United States economy has been in trouble for the past couple of years. The foreclosure crisis is a condition that began due to the inability of homeowners to pay their mortgages. Foreclosure is a legal proceeding whereby a lender obtains a legal termination of a debtor’s right to redemption. The foreclosure rates have been increasing for a considerable period and certain steps have been put into place to solve the problem. While the government, financial institutions and the general public are highly aware of the crisis, the steps taken to combat the problem are still not sufficient as the foreclosure rates are still increasing.