The Federal Open Market Committee Indicates Taper End In March, Rate Hike in our midst! Read on

FOMC Indicates Taper End In March, Rate Hike Soon

Officials at the Federal Reserve have been persuaded by rising inflation and a solid labor market that interest rates must be increased “soon.” However, a specific date has yet to be announced.

The Federal Open Market Committee (FOMC) resolved on Wednesday to hold the federal funds rate target range at 0 to 0.25 percent, but it is expected that rates will be hiked in early March.

Mortgage-backed securities and loan rates will rise in 2022 due to the announcement of a rate hike and the closure of the pandemic-era asset purchasing policy, which will strain mortgage-backed securities. For a typical 30-year mortgage, mortgage rates are currently above 3.5 percent, and the Mortgage Bankers Association predicts that by the end of the year, mortgage rates will rise to 4%. Read More

Revamp Your Retirement: Downsizing and a Reverse Mortgage and Achieve Financial Freedom Today

freedom

Can you downsize your home and also use a reverse mortgage? Yes, and a growing number of people are choosing to downsize and also use a reverse mortgage at the same time.

How Did One Couple Downsize And Use A Reverse Mortgage?

Here’s a possible example (fictionalized): one Southern California couple sold their 4,000 square foot home for $1.5 million. They relocated to a 2,000 square foot home in a community closer to where their children live in Utah. 

Their new, smaller home in Utah cost $450,000. The couple was able to invest another portion of the proceeds from the sale of their home.

The couple was also able to use a reverse mortgage to provide income for their new downsized lifestyle. Combining downsizing with a move and a reverse mortgage allowed them to have the retirement lifestyle of their dreams.

Combining Downsizing, Moving, and Reverse Mortgages

People traditionally view mortgages and moves as separate from income and lifestyle changes. But your overall financial health is affected by all three. Also, if you’ve lived in your home a long time, you’ve probably built up a lot of equity. 

Downsizing from a larger, older home is straightforward. You can sell your older home and receive significant equity, especially if your mortgage has been completely paid off.

Where the transaction becomes more complex is combining a reverse mortgage with a move to a new, smaller home. If you use part of the proceeds to pay for a downsized home, you also have equity in that home.

Couples like our fictional example can provide themselves with income through a reverse mortgage. There’s one thing to consider with a reverse mortgage, however: there are principal limits.

According to the Consumer Financial Protection Bureau (CFPB), how much you can borrow using a reverse mortgage depends on your age, the loan’s interest rate, and your home’s value. 

In the case of a combined original home sale, downsizing, and new home purchase, the reverse mortgage amount will be influenced by the value and equity of your new home as well as your age and the age of your spouse or partner.

Combining the sale of an older, larger home with a move to a new, smaller home, along with using a reverse mortgage to provide income could be a good choice for many older adults. The process is complex, however. Fortunately, there are specialists with experience in the field who can guide you through the process, like California Platinum Loans. Contact them today to discuss your options.


Sources:

Brown, Jeff. “Pros and Cons of Downsizing and Reverse Mortgages,” U.S. News & World Report, url: https://money.usnews.com/investing/real-estate-investments/articles/2017-09-07/pros-and-cons-of-downsizing-and-reverse-mortgages

Consumer Financial Protection Bureau. “How much money can I get with a reverse mortgage loan, and what are my payment options?”

Unlock Your Treasure Chest: Leveraging Home Equity in Today’s Market

Has your home become your treasure chest? Are you looking at that equity and picturing vacations, investment opportunities, or freedom from high-interest credit card debt? Well, dear investor, your ship has come in! California Platinum Loans is here to navigate these promising waters of home equity with you.

Investing with Confidence

Ah, the thrill of the game! Investing can be as exhilarating as surfing at Huntington Beach, but you need confidence. Using your home equity to fund an investment makes sense when your returns outpace the loan cost. If you’re sporting a grin 50% wider than a surfer’s, chances are you’ve found such an opportunity. So, harness your home’s value and ride that investment wave!

Wiping Out Debt in the New Normal

Picture your home equity as a superhero swooping in to rescue you from the villainous clutches of high-interest debt. With low-interest forecasts, using a HEL or Home Equity Loan or HELOC Home Equity Line of Credit to settle a credit card or student loan debt is smarter than a Silicon Valley algorithm.

Investing in Experiences over Things

More people today treasure sunsets over Santorini than a new set of silverware. If you’ve been dreaming of such experiences, using a low-interest home equity loan can make these dreams a reality without the high-interest credit card hangover.

Weighing Your Options

Remember, home equity loans are secured by the equity in your home, making them a not-so-light decision. Just like you wouldn’t dive into uncharted waters, you shouldn’t dive into these loans unprepared. 

By collaborating with a competent professional in home mortgage and home equity loans, you can map out the most suitable path for your financial trajectory.

When it comes to leveraging home equity, the time is ripe, and the opportunities are as vast as the California skies. At California Platinum Loans, we’re ready to help you explore these opportunities and set sail toward a brighter financial future.

Ready to leverage the equity in your home? Contact us today, and let’s transform your equity into opportunity!