If you are over 62 and are a homeowner with a lot of equity in your house, you may consider refinancing into a Reverse Mortgage.  I had lunch with my friend, John Heene, of Directors Mortgage the other day and he explained this often misunderstood form of financing to me.  These mortgages continue to grow in popularity because it enables a homeowner to withdraw the equity in his house and use the cash proceeds for any purpose..travel, pay off debts, help their kids, make a luxury purchase or just live more comfortably.  John recommends that the borrower speaks to a financial advisor, as you would with any major decision like this.

The borrower retains title to the home throughout the life of the reverse mortgage.  He cannot be forced out of his home as long as he is paying the taxes and insurance.  It is only when the last borrower moves out of the house that the loan must be repaid.  At this point many times the borrower or his/her heirs choose to sell the home to repay the loan and preserve the remaining equity for the benefit of the borrower or his/her estate.  The borrower is in control of the home and retains title, not the bank or the lender.

To me a huge benefit is that a reverse mortgage allows a senior to stay in the home they love.  Many people do choose to move to a smaller home when they retire, but for others this may seem like a daunting task.  Seniors need to analyse their situation and the cost involved in moving (real estate commission of 6%, moving costs, etc.) and decide what would work best for them.

Two of the great safeguards for reverse mortgages are that they are structured so the borrower or his estate can never owe more than the value of the home upon repayment.  In addition, the HECM products are insured by the Federal Housing Administration (FHA), an arm of the U.S. Department of Housing and Urban Development (HUD).

Just a few more years and I will qualify for this!

I found this EcoBroker Affiliate member on the EcoBroker site and thought someone may be looking for a resource to buy environmentally friendly hardware.  This is the first local site I’ve come across that sells this product, but if you know of any others, please let me know and I will post the information here.

SILVER MEMBER: EcoBroker Affiliate Profile

Lorraine Vitkauskas
CEO
Nature’s Hardware llc (eco friendly hardware)
PO Box 66286
Portland, Oregon 97290
503-317-5337
503-317-5337 (cell)
503-775-3076 (fax)

http://www.natureshardware.com

EcoBroker Affiliate Statement: 

For green/earth friendly decorative hardware go to http://www.natureshardware.com. All our products incorporate either a natural, renewable or recycled material. We offer knobs, handles, utility pulls, sinks, etc… that incorporate bamboo, stone, wood, leather, antler, recycled glass or metals etc…

Did you know the average home spends about $1900 on energy costs every year? By changing to appliances that have earned the ENERGY STAR certification you can save $80 a year or more in energy costs, while saving the environment. How great is that?

SAVE ENERGY, SAVE MONEY
Realize that an appliance has two prices: what you pay to take it home and what you pay for the energy and water it uses.

HELP PROTECT THE ENVIRONMENT
If just one in 10 homes used ENERGY STAR qualified appliances, the change would be like planting 1.7 million new acres of trees.

Examples:
ENERGY STAR Clothes Washer: You can save $550 in operating costs over the lifetime compared to a regular clothes washer.
ENERGY STAR Dishwasher: Uses 41% less energy than the Federal minimal standard for energy consumption. Save over $30 per year.
ENERGY STAR refrigerators: The new ones use 40% less energy than ones built in 2001. And you get the product quality and performance you expect.

It just makes sense to me. The direct economic savings achieved by efficient appliances is money that stays in your pocket! When you replace older equipment it is not uncommon for electricity consumption for that appliance to decrease by 50% or more. Any increase in initial cost is usually more than made up in monthly savings. And you can feel good about doing your part to help decrease pollution now and for future generations.

There is a lot more great information on these and other appliances at this website: http://energystar.gov/index.cfm?c=appliances.pr_appliances

What is a Short Sale? It’s an arrangement between the owner of a house and the bank holding his home loan to accept an offer for less than what the owner owes on the house. The deficiency (shortage) is the difference between the amount owed on the loan and what the bank collects at the time of the sale.

A Short Sale is not a Foreclosure. In a foreclosure the owner falls several payments behind on their house payments, the bank repossesses it and sells it. In a Foreclosure, almost always the bank will pursue the homeowner for the shortage. And they never stop trying to collect!

How does a seller get into a Short Sale situation? An owner, for various financial reasons, needs to sell his house. He finds he owes more on his house than he can sell it for. He takes the best offer he received and contacts his bank, requesting them to settle for less than he owes (the amount of the best purchase offer from a buyer).

All banks have their own procedures for approving and processing Short Sales, so you need to call and ask your bank for directions on how to proceed. But please know that nothing you discuss on the phone with a bank representative is binding. As with all real estate, it has to be in writing to be binding. In some cases the bank will allow the property to sell at the lower price, but considers the shortage as a ‘loan’ and will require the seller to pay back the amount. It depends on the bank and the agreement you can reach with them. At the very least they will report the shortage as 1099 income to the seller.  If the bank agrees to absorb the shortage and the transaction closes quickly, this will be less of a blow to your credit than a Foreclosure would be.  A Short Sale can be a slow and frustrating process, and sometimes it seems the bank is actually working against the sale! The truth is that usually a Short Sale is better for the banks than a Foreclosure. And their main goal, after all, is to try to get as much of their money back as possible.

Remember that before a bank can approve a Short Sale you must have an offer in writing. At that point you contact the bank and they send you a detailed packet to complete. The packet can contain an application, hardship letter, financial statements, tax returns, pay stubs, a HUD statement from the pending transaction, payoff letters from all lenders involved, and several other things depending on the lender. You will generally not receive approval for 1-4 weeks, and many times they also change the terms. In some cases it all works and the transaction closes, but in other cases the buyer becomes frustrated with the change in terms and the delays in closing and he goes looking for something easier.

If you are considering selling your house and the market value is less than your mortgage amount, read some good information about Short Sales and then contact a Realtor who has done this before. If you are a buyer looking at a house that is listed as a Short Sale, it is helpful if your Realtor has experience in handling Short Sales. It can be cumbersome process but easier if you are well informed and know what to expect. Don’t wait until you are missing payments to consider a Short Sale as this will negatively impact your credit. All you have to do is show that your house can’t be sold for what you owe.

The FSC logo is your guide to the ‘good wood’.  The Forest Stewardship Council (FSC) is an internationally recognized group that can tell you whether the wood you’re holding makes the grade.  The FSC stamp means that the forest is managed according to strict environmental, social and economic standards.  The group was founded in 1993 by a coalition of environmentalists, native peoples and forestry professionals.  Worldwide, nearly 100 million acres of forestland in 57 countries have already secured FSC approval.  And that includes over a million and a half acres in California, Oregon and Washington. 

Landowners are seeing the benefits of going with FSC, and retailers are getting on board.  You’re the last link in the chain.  Please visit one of the fine partners in Portland to purchase wood with the FSC logo:

Earth Advantage
16280 SW Upper Boones Fy. Rd.
Portland
503.603.1733
http://www.earthadvantage.com

Endura Wood Products
1303 SE Sixth Ave.
Portland
503.233.7090
http://www.endurawood.com

Environmental Building Supplies
819 SE Taylor St.
Portland
503.222.3881
http://www.ecohaus.com

The Joinery
4804 SE Woodstock Blvd.
Portland
503.788.8547
http://www.thejoinery.com

Parr Lumber
1320 NW 19th Street
Portland, OR
503.223.8141
http://www.Parrlumber.com/stores/portland-_West_Side/NW19th/

Neil Kelly
804 North Alberta
Portland
(and)
15573 SW Bangy Rd., Suite 100
Lake Oswego
503.288.7461
http://www.neilkelly.com

Wouldn’t it be great to buy wood you can feel good about??

* Thank you Dagmar at the Ecotrust building for the interesting publication where I obtained much of this information.