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QUESTION:
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Reverse Mortgage Origination fees |
| I recently inquired with a lender about a reverse mortgage on a $200,000 house i live in and was surprised to see that the lenders origination fee is $4,000.00 or 2% of the mortgage amount. I called the lender to see why the fee was so high and was told that HUD only allows them to charge a maximum of 2% for the origination fee. I said yes it is the MAXIMUM AND IS NOT A REQUIRED CHARGE. I was told buy the lender that all lender charge the mazimum origination fee of 2%. The origination fees on a standard 30 year fixed rate mortgage are negotiable and with Ditech $295.00 but not on a reverse mortgage. Is this correct? Seems like the service is way over priced to me. |
 | asked by BSeid33859, 2/14/2007 |
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Categories:
Reverse Mortgages
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| ANSWERS: |
| Answered by: Janet, 03/02/07
Overall Rating:  |
Hi -
The fees and rates on a Reverse Mortgage are high... Depending on your situation, it might be better to downsize to less expensive housing.
At any rate, NewRetirement has a pretty good description of Reverse Mortgage costs here: http://www.newretirement.com/Services/Reverse_Mortgage_Fees.aspx Login to rate this answer:  |
| Answered by: Janet, 03/02/07
Overall Rating: Be the first to rate it. |
Perhaps the lender you are working with is not the best.
NewRetirement has screened their lenders. They can refer you to some of the most used lenders in the business, here: https://www.newretirement.com/Services/Reverse_Mortgage_Advice.aspx Login to rate this answer: |
| Answered by: batley999, 05/15/07
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IF YOU BELIEVE THE FEES ARE EXCESSIVE, I SUGGEST YOU CONTACT A PRIVATE INDIVIDUAL WHO IS WILLING TO PAY YOU A LUMP SUM OR MONTHLY AMOUNT, WHILE YOU LIVE IN YOUR HOME WITHOUT MAKING ANY TYPE OF PAYMENT TO HIM, FOR AS LONG AS YOU LIVE. DONT FORGET TO MENTION TO YOUR BENEFACTOR THAT THEY DO NOT HAVE ANY GUARANTEE YOU WILL CONTINUE WITH ANNUAL MAINTENCE ON YOUR HOME . AND, OH, ONE MORE THING , MAKE SURE THEY UNDERSTAND THAT THEY CAN TAKE THE SAME AMOUNT OF MONEY THAT YOU WANT AND INVEST IT IN A HIGH GRADE MUNICIPAL BOND WITH SIMILAR RETURN ON INVESTMENT...MAN YOU SURE HAVE IT ROUGH! Login to rate this answer: |
| Answered by: Terry Dyer, 09/02/07
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Hi Bill,
The origination fee is negotiable but mostly in states like California where the FHA lending limit is $367,790 and borrowers pay upwards of $7,200 when using the larger lenders. Fortunatly borrowers have options and should always ask 3 lenders if they will offer to discount the fee.
With the larger lenders the loan officer often does not have the flexibility that we smaller lenders have.
Best,
Terry Dyer
President
All American Reverse Mortgage
800-201-0343 x 227
terry@jettfi.com
CA,WA,IL,FL,OR,AZ Login to rate this answer: |
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