We’re nearing the end of our First Annual “Best Real Estate Blog” Contest.  Sunday, June 1 marks the end of the voting.  We will be officially announcing the winners of the popular vote, editor’s choice, and random drawing awards next week.

I have yet to receive any entries for the Real Estate Blog World addition to our contest.  It’s disappointing but we understand you may be too busy to attend a conference or write your thoughts on FHA mortgages.  Keep in mind we will be giving away 3 passes in June so you still have the opportunity to win those!  All you have to do is write a post detailing your opinions on FHA mortgages and email it to me (brandon at fhamortgagecenter dot com) and you will automatically be entered for a free conference pass.  At this point, if you write anything you’re one of the winners–so go for it!

Thanks again for all of the support in our networking efforts and please contact us if you ever have any FHA mortgage questions/issues.

With the baby boom seniors entering retirement, many of them have been left with the inability to pay for their retirement years without working. Many people in this generation worked hard, but pensions were falling out of practice. The baby boomers are less likely to be able to afford full retirement at age 65 and of course, no one really knows about the future of Social Security, it seems.

So, as I look at the options available to the average baby boomer, one thing that astonishes me is that there aren’t more people interested in working through reverse mortgages. There is no doubt that this type of lending has its controversy, but for some homeowners it is one of the better ways to pay for retirement, especially when there are not many other options.

A reverse mortgage, which the FHA calls a Home Equity Conversion Mortgage, is a loan that is backwards, so to speak. After you reach retirement age, you are able to take out this mortgage on your home, which will pay YOU a monthly payment each month. The amount has a basis on the overall value of your home now and into the future as well as your life expectancy. When you pass away, your heirs have the ability to buy the home from the mortgage company (if they want to) through another loan or with cash, or the home will be sold to repay the mortgage.Now, many seniors find this an ideal choice, but you should know the costs and know where to get such loans. In terms of cost, there is interest to consider, which can be high in some situations. As for where to get the reverse mortgage, a good place to start is with the FHA. The Federal Housing Administration actually does insure the most common type of these loans (Home Equity Conversion Mortgages.) Most FHA backed loans are more affordable, but again you want to shop around.Other banks offer them as well. National banks and local banks are willing to work with seniors to get this type of help to them. You may also want to consider the options offered by Fannie Me, which is a reverse mortgage that gives you higher limits than the standard FHA reverse mortgage, in some situations.Tips On Making A Wise DecisionBecause the FHA or other reverse mortgage loans can be tricky, costly and can upset some heirs, it is important to consider this option for financing your retirement carefully. Here are some tips to do it right.

• Realize that you cannot get your home’s full value through the reverse mortgage. Rather, there are costs that come out of it. Find a quality calculator to help you determine the amount you are likely to get.
• Be careful with closing costs, they are often quite high.
• Do not get into a reverse mortgage too young. The older you are and the higher the value of your home is, the more money you will see monthly from the payout.

In addition, the reverse mortgage can be in use in various ways. You do not have to have a monthly payment, but can use it as a lump sum or even as a line of credit. Consider your options here closely. I recommend that you only use a reverse mortgage when you have to, but do not avoid using it if you need it. While your children may want you to give them the home after you are gone, the fact that you can use those funds for medications, for trips around the world, or for anything else you may need, can be much more valuable.

There are several key problems with California’s housing market. First, many of the homes here are overpriced and the inflated values are plummeting farther and farther down. If you own property in California, chances are good you are terrified of the outcome of such concerns. Now, without getting on a soapbox here, there is a lot of worry about the housing market throughout the country. The difference n California is that prices are so much higher than any other area and they are falling quite quickly.

Here is a closer look at the problem.

• Home prices continued to grow to some of the highest in the country, as demand for properties rose and it was easy to purchase an affordable loan
• Lenders were offering jumbo loans, which are loans that are thousands of dollars more than the standard home loan in any other part of the country.
• The housing market crisis hits when the Californian homebuyer is unable to pay his adjustable rate loan reset (blame it on whoever you want, but the bottom line is, it happened.)
• Houses start to foreclose because homeowners simply cannot afford the new monthly mortgage payments.
• Lenders are losing money hand over foot and in turn determine they will not be giving out any more risky loans, subprime loans came to a halt and for the first time in years, jumbo mortgages (which financed most of these large, Californian homes) are no longer available.
• House prices fall as the properties around them foreclose. Even people without risk of paying their mortgage are seeing their mortgages become upside down, where they owe more money on the home than it is worth.
• Selling a home in California is next to impossible because of the upside down mortgage

As you can see, this is a very serious situation and there is no easy answer as to how to fix it. FHA is trying to help. They are offering more help to struggling homeowners who need loans that are more affordable. They are also working with homeowners not yet defaulting that need to keep from doing so. The Bush Administration and FHA raised the allowable amount that FHA could insure homes in this pricey neighborhood for.

The risks are still there. California is suffering, but there is hope for many who contact lenders to inquire about possible FHA help.