ARAMCO Report - The Mother of ALL Mortgage Blogs!

San Diego County property tax revenue climbs higher

Posted by Mehran Aram on Tue, Jul 2, 2019 @ 05:07 AM

When the nearly one million property tax bills get mailed to San Diego County residents later this year, it will be the fifth year in a row that the total amount due has grown by more than five percent. County Assessor Ernest Dronenburg announced last week that the expected assessed value of all taxable property in San Diego will amount to just under $575 billion. This is a six percent increase over last year.

California’s Proposition 13 however protects residents from property tax increases more than two percent in a fiscal year, so that actual revenue is expected to be $551.9 billion. The assessments are not just on homes but include parcels of land, businesses, boats and airplanes in San Diego as well.

Income to the County from property taxes help fund public services like police and fire departments, schools and parks.

Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.875 percent and 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.

Topics: San Diego County, San Diego, property taxes, Mortgage rates, San Diego Housing Market, Assessors Office, California Proposition 13, Prop 13, San Diego County Assessors Office, Ernest Dronenburg

New and Improved: It's Not Your Father’s Reverse Mortgage

Posted by Valerie Jansen on Mon, May 19, 2014 @ 15:05 PM

While some things never change, the opposite is true for the Reverse Mortgage program during the past few years.Even though there has been considerable debate about the abundance of changes to the program, the consensus is that these changes have resulted in a strengthened program and allows borrowers to be further protected.

New and Improved: It's Not Your Father’s Reverse MortgageOn the immediate horizon of change to the Reverse Mortgage program, is the HUD Financial Assessment. For Baby Boomers contemplating Reverse Mortgages both now and in the future, these new rules will transform and enhance the program even further. Borrowers, prior to application, will have a clear picture of their current financial situation and how it will change as a result of using a Reverse Mortgage for retirement planning or other financial goals. This is change that is definitely for the better.

From a Borrower’s and an Originator’s point of view, the new rule is both a challenge and an opportunity.  The challenge for the borrowers would be presenting more information, questions and paperwork up front, and resulting in longer presentations and further borrower education for the Loan Originators. Ultimately, the opportunity is invaluable and worth the challenge as it produces increased clarity and certainty that a Reverse Mortgage is the right long-term choice for the Borrower.  It’s a sustainable decision that the homeowner can rely on to serve them well, accomplish their goals, and also gives the Loan Originator a feeling of truly serving the needs of their client. 

An additional benefit of the financial assessment is the choice to bring your advisors into the decision making process. Whether it be family, mentors or professionals that you have relied on for guidance over the years, don’t be reluctant to include them in the equation.  A Reverse Mortgage can be a powerful tool in financial planning.  While it may not be for everybody, it can be perfect for some--even financial planners and investment advisors are quickly discovering its tremendous value.

The bottom line is that this financial assessment is not a pass-fail. Unlike in the forward market, it won’t cause a denial but rather, it will simply determine whether or not the borrower will need a "set-aside" payment for future property taxes and homeowners insurance.  Think of it as the “New, Improved Reverse Mortgage”--A safer, more attractive option for all prospective consumers who are considering using their home equity in planning their retirement.

For more information on Reverse Mortgages, refinancing or on a home purchase contact us at www.ARAMCO.biz or call 877-700-0942. 

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Topics: Reverse Mortgage, financial assessment, Reverse Mortgage Program, Aramco Financial, Housing and Urban Development, HUD, Aramco Mortgage, Southern California, mortgage, Loan Options, Homeowners Insurance, property taxes, borrower

Would You Make The Cut?: New Assessment for Reverse Mortgage Borrowers

Posted by Jay Zayer on Thu, May 15, 2014 @ 15:05 PM

Later this year, the FHA will begin a financial assessment on borrowers looking to obtain a Reverse Mortgage. The purpose of the assessment is to evaluate the mortgageor's willingness and ability to meet their financial obligations.The assessment will also be used to calculate whether a portion of the Reverse Mortgage proceeds will need to be held back in order to cover property taxes and insurance in future years. According to HUD, the new financial assessment guidelines will focusWould You Make The Cut?: New Financial Assessment For Reverse Mortgages on:

•performing credit history analysis and cash flow/residual income
analysis;

• evaluating extenuating circumstances and compensating factors;

• evaluating results of the financial assessment to determine eligibility
for the HECM;

• determining if funding sources for property charges from HECM proceeds
will be required;

• completing a financial assessment worksheet; 

• verification requirements and documentation standards for credit, income,
and expenses.

Additionally, underwriters will look at the borrowers current monthly obligations (found on their credit report) and property charges that include property taxes, home owners insurance, and HOA payments. HUD will require a calculation based on the square footage of the home and is similar to the VA calculation of $.14/sq. ft. If a home is 1800 square feet, an assessment of $252/month would be included in the calculation when determining if a borrower qualifies.

Another component of the calculation will be based on the geographic region the borrower resides in. In the Southwest region, $589/month for a single person and $998/month for a couple would be added to the equation when calculating the financial assessment. For example: a couple living in Southern California who have a 2000 square foot home, $350/month in credit card debt, property taxes of $3000/year and paying $1200 for homeowners insurance would need to make $1978/month to qualify according to the new financial assessment. For many couples living in Southern California $1978/month may not seem like a lot of money however, many senior borrowers looking at a reverse mortgage are doing so because they are on a very tight budget and possibly living month to month.

Unfortunately, the few that do not pass this financial assessment may not qualify for a reverse mortgage and may be forced to sell their home. On a positive note, most borrowers will pass this new policy imposed by FHA.

For more information on purchasing a home, reverse mortgages or home financing contact us at www.ARAMCO.biz or call 877-700-0942.

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Topics: Reverse Mortgage, HECM, financial assessment, Aramco Financial, Housing and Urban Development, HUD, credit, Aramco Mortgage, Southern California, borrowers, FHA, Mortgage applications, Homeowners Insurance, property taxes, HOA Payments, mortgagor