Golden Handcuffs: Why Loan Structure Matters

by Shannon Hicks
| No Comments
| March 14, 2016

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The Overlooked Advantages of the Tenure Payout Option

As the Home Equity Conversion Mortgage evolved rapidly in recent years it is fair to say our target demographic has substantially changed. The financial assessment was the capstone in HUD’s efforts to bolster the product’s financial viability for both borrowers and the mutual mortgage insurance fund. Today as we move toward more affluent borrowers we must exercise caution when suggesting loan payout options.

Ultimately it is the borrower’s choice but we cannot overlook the responsibility of full disclosure. Consider a qualified borrower wth a small mortgage payoff and a substantial net principal limit. This individual has shown a propensity to spend beyond their means and perhaps had several other debts. Such an individual is highly unlikely to utilize the strategic use of a line of credit for a standby reverse mortgage. In fact an open line of credit may be an enticing source of money to…

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Editor in Chief: HECMWorld.com

As a prominent commentator and Editor in Chief at HECMWorld.com, Shannon Hicks has played a pivotal role in reshaping the conversation around reverse mortgages. His unique perspectives and deep understanding of the industry have not only educated countless readers but has also contributed to introducing practical strategies utilizing housing wealth with a reverse mortgage.

Shannon’s journey into the world of reverse mortgages began in 2002 as an originator and his prior work in the financial services industry. Shannon has been covering reverse mortgage news stories since 2008 when he launched the podcast HECMWorld Weekly. Later, in 2010 he began producing the weekly video series The Industry Leader Update and Friday’s Food for Thought.

Readers wishing to submit stories or interview requests can reach our team at: info@hecmworld.com.