Going Forward In Rev.

Here is an article in Financial Advisor Magazine entitled Evensky: New Choice May Preserve Portfolios, Lower Cash Reserve Needs By Karen DeMasters. The HECM saver and your portfolio. Enjoy!

A new type of reverse mortgage may be one key to enabling retirees to preserve portfolios and keep less cash in reserve, says Harold Evensky, a financial planner and nationally recognized expert on retirement issues.

The new federally insured Home Equity Conversion Mortgage, or HECM Saver, allows holders to establish a credit line but not draw on it unless the funds are needed. Payments on interest can be made when the holder chooses to do so or they can be deferred until the home is sold.

Unlike traditional reverse mortgages that provide a lump sum payment, the HECM can provide cash when needed, such as when the markets are down. This prevents the stockholder from having to sell stocks at a loss to get cash. The HECM can then be paid back when the markets are back up, Evensky says, which preserves the portfolio.

The new reverse mortgage is one factor changing the face of retirement planning, says Evensky of Evensky & Katz, a wealth management firm in Coral Gables, Fla. Evensky recently presented his view of changes in retirement planning at a webinar, The Future Ain’t What It Used to Be: The Ultimate Guide to Retirement Planning for Baby Boomers.

Each day 10,000 baby boomers turn 65 and that will continue for the next 19 years, which makes the subject of retirement planning crucial, says Evensky, and that planning needs to reflect some changes.

“We are studying this (HECM Savers) now, but I’m reasonably positive it will become an important part of our planning in the future,” Evensky says. . The use of HECM Savers can reduce the cash reserve that Evensky would recommend a retiree hold Trom two years of liVing expenses to six months because there is the HECM money to draw on if needed.

A HECM is also substantially less expensive than reverse mortgages have been, thereby providing a ready pool of capital to tap into when needed at a relatively low cost, he says.

“When markets regain their strength, the mortgage can be paid back,” Evensky adds. “Our studies indicate this will significantly increase the survivability of the portfolio in retirement.”

Another factor changing retirement planning is the increased use of immediate annuities, Evensky says. An immediate annuity provides regular, lifelong payments guaranteeing an income flow the buyer can’t out live.

“We aren’t utilizing them now because the payout is so sensitive to interest rates and, with current rates so low, we don’t see any risk of waiting to buy in.”

A mistake that financial planners can make in retirement planning is trying to maximize returns. Instead, planners should be maximizing the probability that their clients will achieve their financial goals. Roughly half of Evensky and Katz’s clients are in retirement and another 20% are approaching it, so planning correctly is vitally important.

Conventional wisdom says people spend less as they grow older, mostly because of the constraints of poor health. However, Evensky says, in the future people will live longer but not necessarily get sicker until they are near death, so planners should not make the assumption clients will be spending less. “When you retire you have more time, and time costs money,” he says.

Retirement planning should be done in a three-dimensional, rather than a two-dimensional, world, where the factors to be considered are returns, risks and taxes and expenses. Evensky advises hiring money managers who are extremely tax efficient.

The flip side of not saving and investing correctly is under spending and having money left at the end of life. “Your clients should not be so conservative that they deny themselves the lifestyle they will enjoy,” he says.

Evensky also believes in what he calls a five-year mantra, since five years is roughly the equivalent of an economic cycle.

“Simply put, we don’t believe anyone should be investing funds they may need in the next five years. Otherwise, they may have to sell at the wrong time,” he says. “We replenish the cash-flow reserve as we manage the investment portfolio.

“If someone has $1,000,000 in savings and indicates they want to buy a second home for $100,000 three years from now, we would suggest they carve out $100,000 and put it in cash-flow reserve comprised of short-term bonds and cash and invest the remaining $900,000,” Evensky explains.

On another aspect of financial planning, Evensky is a firm believer in account aggregation so an advisor can see all assets held by a client, including 401 (k) plans and assets that might be handled by a competitor.

“Since the advent of account aggregation, I’ve been a big believer that it needs to be an integral part of what we do as practitioners because our job is to work with our clients holistically,” he says.

Also, the software lets the advisor see how other managers are handling some of the assets and may provide the advisor with an opportunity to show a client he could handle the assets better and therefore gain business, Evensky says.

Get more information today!

Phil Goss:

Phil is a Certified Reverse Mortgage Professional, (CRMP), NMLS#162804 and has been in the industry for 16 years and in finance since 1971. He has been able to help 600 plus families with a revere mortgage and to “Age in Place”.

Phil has been able to earn the desigination CRMP, Certified Reverse Mortgage Professional. What is CRMP: As read here on the National Reverse Mortgage Lenders Association’s (NRMLA)website: http://www.nrmlaonline.org/nrmla/crmp/default.aspx

Here is video 3 in my series on Reverse Mortgages. The Home Equity Conversion Mortgage (HECM) Reverse Mortgage by Phil Goss, Certified Reverse Mortgage Professional. Southern California Reverse Mortgage Professional.

What is a reverse mortgage? By Phil Goss, Certified Reverse Mortgage Professional

Phil is a CRMP, NMLS#162804 and has been in the industry for 16 years and in finance since 1971. He has been able to help 600 plus families with a revere mortgage and to “Age in Place”.

This is the second of a series of videos on the subject. Please stay tuned for more.

If you have a question about reverse mortgages give me a call at 909-524-8713 or 626-963-5918. Talk to you soon.

Who is Phil Goss, Certified Reverse Mortgage Professional?

Phil is a CRMP, NMLS#162804 and has been in the industry for 16 years and in finance since 1971. He has been able to help 600 plus families with a revere mortgage and to “Age in Place”.

This is the first of a series of videos on the subject. Please stay tuned.

If you have a question about reverse mortgages give me a call at 909-524-8713 or 626-963-5918.

Found this article on the use of a credit line in a reverse mortgage. If you any questions please let me know. Enjoy!

February 27th, 2012  |  by Elizabeth Ecker Published in News, Reverse Mortgage

It is a privilege to share my reverse mortgage knowledge with you and as a dedicated Reverse Mortgage Professional. It is my goal to provide the highest quality service you expect and deserve.  Understanding that there are many lenders looking for your business, I would like to share the top ten questions you should consider asking a lender in order to earn your business.

1. Are you a member of the National Reverse Mortgage Lender’s Association (NRMLA)? They uphold Best Practices and enforce a Code of Conduct to make sure members treat seniors respectfully and ethically transact business.
2. Are you Better Business Bureau accredited? What is your rating?
3. How large is your company?
4. Who provides your major financial backing?
5. What is your personal mortgage experience and that of your company?
6. Will I be pressured to purchase additional products?
7. Can you offer competitive pricing?
8.  How soon will my loan be processed?
9.  Is your company published and respected by national media?
10.  Do you service your loans?

Compare 1^st Reverse Mortgage USA Answers:

1. Yes.  Senior members of the 1^st Reverse Mortgage USA management team are Board Members of the National Reverse Mortgage Lenders Association (NRMLA) and serve as the Co-Chair of the Board of Directors, Chair of the Ethics and Financial Assessment Committees, member of the Independent Certification and State and Local Legislative Committees
2. Yes. We have earned an A+ rating from the Colorado Better Business Bureau and have earned its highest award, the Gold Star of Excellence.
3. 1^st Reverse Mortgage USA is in the top ten reverse mortgage originators in the nation.
4. 1^st Reverse Mortgage USA is a division of Cherry Creek Mortgage Company, Inc. located in Lakeland, Colorado.  As a privately owned and operated full-service mortgage banking company, Cherry Creek is ranked in the top 25 retail mortgage originators in the Nation with annualized  average volume of over $3.0 billion.
5. I have been in the real estate finance industry since 1971 and have personally closed nearly 600 reverse mortgage transactions in the past 15 years.  Our staff has hundreds of years of extensive forward and reverse mortgage experience.
6. At 1^st Reverse Mortgage USA, our only product line is reverse mortgages. Our knowledge, experience and attention to detail make the program easy to understand and the process simple.
7. Yes. We offer competitively priced fixed and adjustable rate reverse mortgages.  As part of our vision, we first and foremost educate anyone and everyone who is sincerely interested in the well-being of seniors.  We believe that every senior homeowner should have the opportunity to make an informed decision about a reverse mortgage after considering all their options.  A company’s expertise, stability and superior service, and not price, should be at the foundation of the decision making.
8. Many of our loans close in 30 days or less.
9. Honest. Ethical. Dependable. Solid.  We hear it time and time again, because 1^st Reverse Mortgage USA holds fast to straight-forward ideals: passionate service, honesty and a commitment to our customers and our company.
10. 1^st Reverse Mortgage USA has direct endorsement authority from the Department of Housing and Urban Development to originate, process, underwrite, and close reverse mortgages.  It will soon be servicing reverse mortgages also.

Educational note:  I offer free Reverse Mortgage Seminars and Lunch & Learn workshops in your area. If would like a one-on-one meeting or to have a workshop held  at a local meeting, church group, or any other type of function, I welcome the opportunity to help educate you on this product that has changed peoples’ lives. Please call me at 1-909-524-8713!

Phil Goss is a Certified Reverse Mortgage Professional, NMLS #162804, with 1^st Reverse Mortgage USA0.  Phil has been serving senior homeowners in Northeast Los Angeles County including Pasadena, West San Gabriel Valley and part of the high desert and Inland Empire for many, many years. For more reverse mortgage information, call 1-626-963-5918 or visit Phil online for a free estimate and view customer testimonials at www.goingforwardinreverse.com

The Basics

To qualify for a reverse mortgage you must be at least 62 years old and have substantial equity in your home. You can access your funds as a lump sum, monthly income, a credit line, or a combination of these.

Use your money any way you like to enjoy paying down your debt, staying in your home, eliminate current monthly mortgage payments, supplement your retirement income, etc.

Choose from competitive FHA-insured HECM Standard and Saver products as well as our proprietary jumbo loan, Generation Plus® to get the highest possible payout.