Australia’s reverse mortgage market is growing so fast that another broker platform is opening up.

With reports revealing the $1.5 billion market is close to doubling each year, it is a timely development.

Unlike most mortgages, reverse mortgages need to be handled very carefully to match people with the right product.

Appropriately trained brokers are able to do that by presenting a range of reverse mortgages offered by different companies.

More than 40 brokers who are part of the independent Fortus network will offer a range of loans that comply with the industry’s SEQUAL “no negative equity” guarantee.

Brokers wrote about 47 per cent of reverse mortgages in 2006, compared to 38 per cent in 2005 and just 17 per cent in 2004.

“There is no doubt reverse mortgages will continue to grow in popularity as baby boomers seek ways to fund their retirement,” said reverse mortgage specialist and Fortus chair Craig Swan.

Fortus will initially focus just on reverse mortgages but will broaden to include home reversion schemes and shared appreciation mortgages as these products eventuate.

Found here.

Q: I want to refinance my home and use the money to fix up my house. I’d replace my deck, add a screened porch, and either landscape the front yard or put in a laundry room.

My credit score is around 800. I am 58 and plan on working until at least 62, but I will most likely need to work all the way to 65 or 66. At that point I want to sell my house and travel for a few years, then move close to my brothers and buy a small house on a lake or river so we can fish through old age.

What kind of loan would be right for my situation? I have looked at a 30-year fixed rate mortgage, and also at a 30-year loan that would be interest-only for 10 years but would require me to pay off the principal over the next 20 years.

Of course, I probably won’t be living in the house by then. Should I choose the interest-only loan? I have approximately $500,000 in my 401(k) but will need the proceeds from the home sale to buy the lake house near my brothers.

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Come Oct. 1, auto insurance will no longer be required in Florida.

It’s the consequence of the Legislature allowing Florida’s no-fault auto insurance law to expire.

The aim of ending no-fault, which requires drivers to buy $10,000 of personal injury protection to cover the cost of medical care, was to reduce the widespread fraud created by the program and to lower insurance rates. But PIP is linked to the state’s other type of mandatory auto coverage – property damage liability.

The demise of PIP will kill the mandate to carry a minimum of $10,000 of property damage liability coverage, according to the state Department of Highway Safety & Motor Vehicles, which enforces the no-fault law.

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Twenty-seven foreclosures are listed today in The Frederick News-Post.

It’s not the highest number — one day this spring had 30 — but it reveals that problems continue to simmer in the housing market.

“There are still quite a few foreclosures out there,” said Terry Fox, president of the Frederick County Association of Realtors.

However, Fox said foreclosures, if a property makes it to that stage, take a long time.

“It doesn’t happen right away. It can take six months for the bank or lender to go through appraisal, inspection, title work, etc.,” she said.

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A coalition of insurance companies has taken its latest step in an effort to repeal a new state law that could triple damages against insurance companies in certain court cases.

The coalition, Consumers Against Higher Insurance Rates, turned in 155,220 signatures Friday to get Referendum 67 on the ballot. State law requires 112,440 valid signatures, but initiative backers generally need to collect 25 to 30 percent more to allow for invalid signatures.

If enough signatures are valid, voters will decide in November whether to keep the law.

The coalition has raised more than $1.8 million for its campaign. It spent more than $350,000 of that on signature-gatherers to qualify the measure for the ballot. Now the group will campaign to repeal the law by encouraging voters to vote no on the referendum.

The new law makes several changes, but the one that has insurance companies most riled is a provision that allows courts to approve triple damages if an insurance company unreasonably denies coverage or payment.

The insurance industry contends the new law, which does not apply to health care, makes it easier for people to sue if claims are denied.

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A number of U.S. states are setting up funds to help homeowners with risky subprime mortgages refinance to more affordable loans in a bid to slow the rate of home foreclosures, the Wall Street Journal reported on its Web site.

The states — which include Maryland, Massachusetts, New Jersey, New York, Ohio and Pennsylvania — are expected to invest a total of more than $500 million in the effort, the newspaper said.

State officials hope this will be enough to keep some vulnerable low and moderate income neighborhoods from sliding into decline.

The Journal said some of the programs will be similar to existing government-lending programs, in which the state extends mortgages to homeowners and then sells those home loans, in some cases to companies such as mortgage and finance giants Fannie Mae and Freddie Mac.

The state then recycles the proceeds from the sales to make additional loans, the newspaper said.

Found here.

A very short history of how we got here:

All of the turmoil in the CDO, hedge fund, and subprime space has come about due to a very simple reason: An inordinate number of recent home buyers have been defaulting on their mortgages.

The why of this is rather simple: These are the folks who historically have not been home owners due to their debt obligations, low income, and/or poor credit. In the past, they were known as renters.

The ultra-low rates that Easy Al put into place when he dropped the Fed Funds to 1% started an entire chain reaction of events: If high rates keep home prices down, well you can guess what ultra-low rates do. Home prices rose due to the lower monthly carrying costs, and we were off to the races..

But the boom begat a feeding frenzy, and corruption soon followed. The appraisers faked values to get loans approved (making a 100% LTV look like a 80%). Mortgage brokers quickly learned how to get nearly anyone approved through no doc/no income check loans, AKA liar loans. A bunch-o-new mortgage products came out — Interest only ARMs, LIBOR based, etc. I am not sure what legitimate purposes these very profitable products served, but we know what they accomplished: They got people into homes THEY COULD NOT AFFORD.

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· Radical shakeup proposed to limit bar on payouts
· ABI insists changes would not help consumer

Policyholders could find it easier to make claims against their insurance policies, if proposals put forward yesterday by the Law Commission are adopted.

The legal reform body wants to update the 100-year-old law covering insurance claims and restore the confidence of consumers. Its proposals would reduce the refusal of claims when consumers have made innocent errors in disclosure sections of insurance proposal forms.

The Association of British Insurers rejected the changes yesterday, saying: “More law is unlikely to provide a better deal for consumers. We are doing a lot already to improve confidence among customers.”

The Law Commission says the law, based on the Marine Insurance Act 1906, is no longer suitable for a world of mass market policies or compulsory cover such as third party motor insurance. It says new laws are needed to restore consumer confidence in personal policies and to underscore London’s position in the international insurance market.

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Residents detail how they lost their homes; Montgomery has seen more than 700 foreclosures in the past three months

Each time YaVonne English recounted how she lost her house in Silver Spring, she was on the verge of tears. Three years ago, she said, a series of financial setbacks led her to seek help from unscrupulous lenders.

A broker referred her to an investor whose wife was a real estate agent.

‘‘I sold them my house with the intentions to rebuy it after a year of renting from them,” she told reporters at a news conference Monday in Rockville.

English owed $150,000 on her home. The husband-wife team bought the house for $300,000. A year later, the investors’ new asking price: $500,000.

English lost the house that her parents bought in 1970 — and that her dying mother willed to her.

‘‘Maybe it would be better, but I haven’t seen the investor nor his wife punished,” an anguished English said after the news conference. ‘‘I know God does the punishing, but it would satisfy me if at least she couldn’t sell real estate anymore or something.”

English’s story holds a mirror to the two-pronged problem occurring across the state: rising numbers of homebuyers losing their homes, and the need for tougher laws to thwart the practices of dishonest lenders.

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The owners of the 100 N. Main St. apartment and retail building have defaulted on the $6.1 million construction loan for the six-story building, sending the property into foreclosure proceedings.

A Winnebago County Circuit Court civil suit filed June 29 indicates 100 Block LLC partners Ben Ganther and Robert Niebauer, of Middleton, owe Banker’s Bank of Madison’s lending arm, BB Syndication Services Inc., $5.9 million in principle and interest. The bank had given the building owners two extension periods since Jan. 10 to refinance or pay off the debt.

The foreclosure, which will ultimately lead to new ownership, combined with an Oshkosh Board of Review’s decision in May to lower the building’s assessed value by more than a third, raises questions about whether the tax increment financing district, or TIF, created to spur the development will remain solvent.

In 2001, the city used TIF funding to provide the developers with a $2.2 million developer assistance grant that covered 25 percent of the building’s $8.8 million construction cost. Ganther and Niebauer made personal guarantees to pay the city enough money to cover its TIF borrowing if the property itself did not generate enough tax revenue to cover debt payments on the city’s TIF borrowing.

The pair this year defaulted on this year’s $328,527 payment needed to make up for lower-than-needed tax revenues from the building. And the decrease in the building’s assessed value, from $6.1 million to $3.9 million, means the difference between the property tax revenue generated by the building and the amount needed to cover the TIF debt will increase.

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