Despite years of misinformation, new efforts to shed light about the growing uses and power of reverse mortgages appear to be working. New data shows that reverse mortgages have transitioned from being a last resort for the cash-strapped to a significant part of Americans' retirement plans.
California is behind the vast majority of reverse mortgages nationwide. With 8,002 loans originating in 2015, California represented 18.8 percent of the national total. This information comes from the Department of Housing and Urban Development's most recent data.
In cities with a greater population of Baby Booms, like Portland, Seattle and Denver, there have been double digit increases in year-to-year statistics. Portland for instance saw a 26.6 percent increase in the number of reverse mortgage originations from 2014 to 2015.
For those 62 years and older a reverse mortgage can both eliminate mortgage payments and provide supplemental income in the form of monthly payments, a lump sum or a line of credit which can continue to grow over time.
Today, conventional conforming no-point 30-year fixed mortgage rates are averaging 4.25 percent while 15-year rates are near 3.375 percent.
Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your questions may be featured in an upcoming article.