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Lowering Home Closing Costs

Chucking the Extra Closing Costs
Cleaning. Few of us like to do it, yet we seem more willing to spiff up our houses for others than for ourselves. Housekeeper due to arrive? Quick, toss those dirty clothes in the hamper! In-laws invited for dinner? Polish the silver and run the vacuum!

Selling the house? Pull out all the stops. Take an old toothbrush to the grout! Replace the kitchen linoleum! Paint the exterior!

While it certainly makes sense for your reverse mortgage prospects to enjoy a clean, comfortable house while they own it — and take all available measures to make it shine for sale at the right price — too many seniors make the mistake of selling one home, then buying another and applying for a HECM in order to avoid paying a mortgage in their retirement years. They’ve thus paid a completely unnecessary, double set of closing costs!

The smart move, of course, is to obtain the reverse mortgage at the time of the new home purchase. The Housing and Economic Recovery Act of 2008 created this special HECM for purchase loan, which went live on January 1, 2009. Find all the details here.

Educating Reverse Mortgage Prospects

So the ideal “spring cleaning” assistance to offer your prospects and clients this season? Reverse mortgage education:

• When does downsizing make sense? Is it appropriate for you and your spouse now?
• Explain why a HECM (reverse mortgage) for purchase means one set of closing costs, not two.
• Help your client begin the process of qualifying for a HECM for purchase loan, so they can enjoy their retirement free from monthly mortgage payments.

Best of all, this type of spring-cleaning is so much gentler on older backs — not to mention bank accounts. You get the business, they save the additional closing costs. Everybody blooms like a fresh spring garden.

In Part 2, we’ll look at ways to help your clients “age-proof” their homes.