How Much Can You Borrow With A HECM Reverse Mortgage?

Posted on April 2, 2020 by Beth Paterson, CRMP

Determining How much is available with a reverse mortgage Have you considered a reverse mortgage and wondered how much you could borrower? Are you concerned that your retirement funds are reduced during this bear market? Having funds available from a reverse mortgage when the market is low can benefit your retirement portfolios. We have borrowers who are thankful they have these funds so they don’t have to pull money from their portfolios while the market is down.

The following outlines how much you could borrow with a Home Equity Reverse Mortgage (HECM) reverse mortgage.

FHA calculates a Mortgage Lending Limit. This is the maximum amount a lender will look at in determining how much will be loaned to a borrower. Initially one cannot borrow 100% of the home value.

There are several factors used to determine the amount of money available to the borrower(s) initially. The amount available to be borrowed is the Principal Limit.

– The Principal Limit depends on:

Type of reverse mortgage program chosen
Age of the youngest borrower or in the case of an Eligible Non-Borrowing Spouse, the age of the younger spouse
Current expected interest rate based on a 10-year SWAP, rates are currently low so more funds are available than when they are higher.
Appraised value of the home or FHA’s Mortgage Lending Limit; whichever is less
For the HECM For Purchase, the appraised value, FHA Mortgage Lending Limit or purchase price, whichever is lower

The amount available for a borrower to use is determined by:

– Principal Limit

Less Service Set-aside (if applicable)

– Equals available Principal Limit

Less closing costs

– Equals net available to borrower(s) before mandatory obligations. Mandatory obligations are items required to be paid off at closing or during the 1st year. For example, mortgages, liens, judgements, federal debt such as taxes or student loans. It can also include set-asides for repairs and taxes and insurances due in the 1st year.

Less any mandatory obligations
Less Life Expectancy Set-Aside (LESA) if required or chosen (A set-aside to pay property taxes and hazard insurance in the future)

– Equals net available to be used as borrower(s) desires

One can obtain a HECM reverse mortgage on higher valued homes. The amount borrowed is based on the FHA Mortgage Lending Limit, currently $765,600

While initially you cannot borrow 100% of the home value. Over time with the small monthly loans of interest and FHA Mortgage Insurance Premiums being added to the loan balance, your loan balance, or amount you borrowed, could be the home value or more than the value at time of origination. As a non-recourse loan, borrowers or their heirs do not owe more than the appraised home value at the time the loan is being repaid.

Would you like to explore a reverse mortgage for your situation? Contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

For other states, contact your local reverse mortgage specialist who is a broker, one who works with several lenders, has their Broker License/NMLS and preferably holds the Certified Reverse Mortgage Professional (CRMP) designation.

This material may be re-posted provided it is re-posted in its entirety without modifications and includes the contact information, copyright information and the following link: https://wp.me/p4EUZQ-3yN

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Reasons to obtain a Reverse Mortgage

Posted on April 10, 2019 by Beth Paterson, CRMP

I often hear that people think the reverse mortgage is only for those with an immediate need on their current home. While this is one reason one obtains a reverse mortgage, there are five general reasons to obtain a reverse mortgage. Let’s explore all of these.

Needs based or improving cash flow: Need funds immediately for covering living expenses or wants to eliminate the current mortgage payments.

Lisa and George had a small mortgage remaining on their home. It was difficult to make the monthly payments so they obtained a reverse mortgage to eliminate the payments. There were remaining proceeds that they left in a Line of credit for future use. And they are still paying their property taxes and insurance.

Joe needed a hearing aide but couldn’t afford it with his Social Security benefits. Rather than taking money from his savings, he obtained a reverse mortgage. He also used some of the money to put new siding on his home.

Maintaining lifestyle: Having funds for travel, buying a car, purchasing vacation home; fulfilling dreams or meeting goals.

To fulfill dream of traveling Helen obtained a reverse mortgage

Helen was struggling to meet her living expenses with just her Social Security Benefits. She also had always dreamed of traveling. The reverse mortgage provided the extra cash she needed and she was able to fulfill her dreams of traveling

Bob’s wife passed away so her Social Security was no longer received. To replace the 2nd Social Security check his financial advisor suggested a reverse mortgage so he could stay in his home and maintain his lifestyle. The reverse mortgage paid off his current conventional mortgage and eliminated his mortgage payments – this improved his cash flow. Then Monthly Draws were set up to add the extra money he needed each month to maintain his lifestyle. Additionally funds were left in the line of credit for future needs.

Protecting or delaying draws from other investments: Using the reverse mortgage to tap home equity rather than accessing other investments or retirement funds that may have penalties or are taxable; let the investments or retirement funds grow so more retirement funds are available later in one’s life; use the home equity so other investments can be left as the inheritance.

Dorothy closed on her Home Equity Conversion Mortgage (HECM) reverse mortgage as a tool to strategically manage her assets and the benefits she has received from her reverse mortgage. She’s used the funds for home repairs and travel, and hasn’t had to use her investments.

Reverse mortgage provides funds to enjoy retirement and have funds for future

In their mid-70’s, Pat and Mary planned for their retirement. But as their life changed they found there wasn’t enough money to last through the end of the month. With the reverse mortgage in place providing monthly cash flow and a line of credit for other needs, Pat and Mary’s retirement funds may be protected for their future. They are living their retirement years with a good plan along with funds for their current needs. Now they have more money at the end of the month – what a way to live in retirement!

Ray used a reverse mortgage on his primary residence to build a new lake home. Using the reverse mortgage for this purpose meant he didn’t have to tap into other retirement investments, yet created a new investment. His plan is in 10 years to start using his other retirement funds.

Planning for financial or long-term care needs (Standby reverse mortgage): Taking the reverse mortgage at a younger age then leaving in the line of credit, which grows to have funds to draw from in the future when “life happens.”

Charles and Sharon both in their early 60’s used the reverse mortgage to pay off their conventional mortgage. Since they were still working, they continued to make payments on their reverse mortgage. Their plan is to pay down the reverse mortgage loan balance and increase their line of credit so it grows for their future long-term care needs.

Purchasing a new home: Whether downsizing, moving closer to family or buying a dream home or investment property, the reverse mortgage can be used for the financing.

Purchase a new one-level home to meet changing health needs

Richard and Lou needed a one-level home to eliminate stairs that were getting hard to navigate. Instead of using conventional financing or paying cash, they used the HECM for Purchase (H4P) Adjustable Rate. Using cash from the sale and the H4P, they were able to purchase their dream home at a higher value than paying cash would have allowed, have funds for moving expenses and still have funds in a line of credit.

Mike and Carol decided they needed a one-level home to fit their changing health needs, they used the Home Equity Conversion Mortgage HECM for Purchase to purchase their new home instead of using conventional financing. This benefitted their cash flow and meant they didn’t have to tap other retirement funds.

Jim and Paula used the fixed rate reverse mortgage to purchase a new home closer to their children.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

HECM Reverse Mortgages and Non-borrowing Spouses, What You Need To Know

Posted on February 8, 2019 by Beth Paterson, CRMP

Reverse mortgage can be done with a non-borrowing spouse

There are times when one is looking into a reverse mortgage but there is a spouse that is not 62. HUD implemented some options and protections for some non-borrowing spouses. Let’s take a look at what you need to know about the HECM Reverse Mortgages and Non-borrowing spouses.

A Non-Borrowing Spouse is the spouse, as determined by the state law where the spouse and borrower/ mortgagor live at the time of closing, but is not a borrower on the loan.

Non-Borrowing Spouses must comply with FHA’s requirements.

Non-Borrowing Spouses do not need to be 62 at the time of the closing, however, the amount of proceeds available are based on the age of the younger borrower or Eligible Non-Borrowing Spouse.

Non-Borrowing Spouses may qualify for a Deferral Period. The Deferral Period is the time following the death of the borrower during which the due and payable status is deferred for a Non-Borrowing Spouse.

For Non-Borrowing Spouses on loans as of April 25, 2014, the borrower must be legally married at the time of closing in order for the Deferral Period to apply.

In 2015 HUD clarified the eligibility of Non-Borrowing Spouses:

An Eligible Non-Borrowing Spouse is one who is married to the borrower and occupies the home and has their age used for determining the principal limit or maximum claim amount of the loan. The Eligible Non-Borrowing Spouse maybe protected by the deferral period.
An Ineligible Non-Borrowing Spouse is one who is married to the borrower but does not occupy the home and their age is not used for determining the principal limit or maximum claim amount of the loan. Ineligible spouses are not protected by the Deferral Period.

Borrowers and Eligible Non-Borrowing Spouses must respond annually to the marital status certificate and occupancy status certificate. HECM provides funds for retirement

The Eligible Non-Borrowing Spouse must:

Have been the spouse of a HECM borrower at the time of the loan closing and have remained the spouse of the borrower during of the borrower’s life.
Have been properly disclosed at origination and named as a Non-Borrowing Spouse in the HECM loan documents.
Have occupied, and continued to occupy, the property secured by the HECM as their Primary Residence.

If a divorce occurs, the borrower must provide a copy of the divorce degree. The Non-Borrowing Spouse is no longer eligible for protections and the Deferral Period and not required to provide the annual certificates.

The Deferral Period will not apply to anyone the borrower is not married to at the time of closing but marries in the future.

The home must be the primary residence of the borrower at the time of their death in order for the Eligible Non-Borrowing Spouse to qualify for the Deferral Period.

If the borrower dies before a Non-Borrowing Spouse, the due and payable status will be deferred as long as the Eligible Non-Borrowing Spouse continues to meet all the qualifying attributes and satisfies the requirements:

Establish legal ownership or on-going legal rights to reside in the property secured by the HECM within 90 days from the death of the last surviving HECM borrower.
Ensure all obligations of the HECM borrower(s) continue to be satisfied after the death of the last surviving borrower.
Ensure that the HECM does not become due and payable for any other reason after the death of the last surviving borrower.

The due and payable status is in the Deferral Period only for the time the Non-Borrowing Spouse continues to meet all requirements of the loan and the property remains the Principal Residence of the Non-Borrowing Spouse. If any conditions cease to be met, the Deferral Period ends and the loan immediately become due and payable.

The HECM is non-assumable therefore the proceeds of the HECM are not available for use or disbursement to any Non-Borrowing Spouse during the Deferral Period.

The HECM funds will only be made available during the Deferral Period for items specified in the loan documents, i.e., from Repair Set-asides for required repairs outlined during the origination period and required to meet FHA insurability and are satisfactory and completed during the established time frame. No unused funds will be disbursed.

The mortgage will continue to accrue interest based on the terms of the mortgage and loan agreement at the time of closing.

The FHA Mortgage Insurance Premium (MIP) will continue to be charged and sent to FHA.

If applicable, servicing fees will still be collected i accordance with the terms of the loan.

Non-borrowing spouse may qualify for due and payable deferral period

When the Deferral Period ends and the loan is called due and payable, the interest, MIP and servicing fees if applicable, along with any proceeds received from the borrower during the term of the loan will become due.

Don’t run from a reverse mortgage if your spouse isn’t yet 62 but know HUD’s rules. Take time to understand and have the facts.

If you’d like to understand and get the facts on reverse mortgages? Contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Reverse Mortgages are not complicated; but are multi-faceted

Posted on September 12, 2018 by Beth Paterson, CRMP

Reverse Mortgages are not complicated but multi-faceted It is often stated that reverse mortgages are complicated or complex transactions. In reality reverse mortgages aren’t any more complex than a conventional mortgage or other financial products. Do you understand all the terms and features of a conventional mortgage or HELOC? Do you understand your 401K’s, stock investments or other retirement plans? What about your credit card(s)… do you know how they work?

Comparing Your Smart Phone To A Reverse Mortgage My smart phone has so many bells and whistles I don’t understand all the options or how it works. They too can seem complex but are really just multi-faceted. I still utilize one and I don’t think I could live without it any more. If people are open to getting the facts, they will likely have a better understanding of reverse mortgage and might just find it useful.

Rather than looking at reverse mortgages as complicated, look at them as they are multi-faceted.

Let’s clarify some of the facets about reverse mortgages.

People still think the bank or the lender will own the home once the reverse mortgage is done. Or the bank or lender will take ownership once the loan becomes due and payable. However, like a conventional mortgage or HELOC, the title remains in the homeowners’ name, the bank or lender does NOT own the home. When the reverse mortgage borrowers are no longer in the home as their primary residence, the loan becomes due and payable.

The amount repaid is the amount borrowed by the homeowners including interest and FHA Mortgage Insurance Premiums over the term of the loan. (Because one is not making payments, essentially one is making small loans each month.)

After the loan balance is paid off, any remaining funds go to the borrowers or their heirs. As a non-recourse loan, if the loan balance is higher than the fair market value of the home, the borrowers or their heirs don’t have to come up with the difference.

Other false statements often seen or heard are that reverse mortgages are a scam, only the lender benefits. They take advantage of people. Let me clarify, the most common reverse mortgage, the Home Equity Conversion Mortgage (HECM) is FHA insured and regulated by HUD – no, not scams but a valid loan using a home as collateral.

Celebrating having a revese mortgage Borrowers receive many benefits in having funds to use for current needs or retirement and long-term care needs without having to make monthly interest and principal payments, improved cash flow without restrictions on how the funds can be used, being able to stay in their home or purchase a new home.

Originators and lenders do get paid for reverse mortgage loans, but everyone gets paid for the work they do. Personally I find it rewarding to help people, and I’m not ripping people off, in fact I and others I know in the industry are certainly not getting rich in this career…there is a lot of work involved to originate reverse mortgages, but we’re passionate in making a difference for people. In fact, because of all the work, on some loans our compensation works out to very little.

Headlines have stated seniors are losing their homes to foreclosure if they don’t pay property taxes or keep insurance on the home. Think about it, with or without a mortgage if you don’t pay property taxes, the county will foreclose. If you don’t have insurance on your property and the home is destroyed you will have lost your home and you won’t have the money to rebuild or replace it. Neither of these are the fault of a reverse mortgage.

We often see or hear that the reverse mortgage should be a last resort, to refinance with a conventional mortgage or Home Equity Line of Credit (HELOC) or sell. The problem with this is most seniors don’t qualify for conventional mortgages or HELOCs. And if they do, the borrowers have to make monthly mortgage payments. Even if they can make the payments now, if life happens they may not be able to make the payments in the future. Rather than being a last resort the reverse mortgage can help one pay for retirement, long-term care.

The unused portion of the reverse mortgage line of credit grows so more funds can become available in the future. And the funds in the line of credit could be higher than what one could qualify for in the future. This can be very beneficial to seniors and isn’t available with any other loan.

Seniors often want to stay in their home rather than moving so don’t tell them to sell. If they do sell, where are they going to live? They’d still have housing expenses…can they afford those or wouldn’t having no rent or monthly mortgage payments be more beneficial?

HECM for Purchse If they do wish to sell maybe to downsize, move closer to their children or to purchase the home of their dreams, the HECM for Purchase program gives them the option to purchase without having to make monthly principal or interest payments. And maybe even create a line of credit for future needs.

Have you heard or read reverse mortgages are expensive? Have you looked at the costs of a traditional or forward mortgage? The costs are the same other than the FHA Mortgage Insurance Premium. With a conventional mortgage people want to know what the payment will be and what the interest is, they generally don’t pay attention to the costs. But when you look at the costs of the conventional mortgage you’ll likely be surprised, they aren’t really different from reverse mortgages.

HELOC’s may have lower up-front fees but the interest rate may be higher which in the long run could turn out to be more expensive than a reverse mortgage… besides one has to qualify on income, assets and credit. Additionally payments have to be made on the HELOCs. And there is a risk that they HELOC could be called due and at some point during the term the monthly payment must be increased to include the principal, not just the interest.

Other headlines or statements about reverse mortgages state the bank/lender gets the children’s inheritance. Another false one! The homeowners receive funds during the term of the loan, whether to pay off conventional loans or receiving funds monthly or draws from their line of credit. When the loan is being paid, due when the home is no longer the primary residence of the borrower(s), there may or may not be funds left for an inheritance. The lender is receiving payment of principal and interest, this is NOT stealing the children’s inheritance from the remaining equity. With the reverse mortgage, the homeowner is using the funds for their needs or wants. Are you as heirs going to give them the funds they need just so you have an inheritance? What about letting your parents live their quality of life and not worry about getting an inheritance?

The last one I’m going to cover today is the option that lowering your expenses is a better option. Really? Most seniors don’t have this option. Seniors want to maintain their lifestyle and why shouldn’t they? Do you want to be told to lower your expenses, stop getting your hair done, not having cable TV, being able to get together with friends for lunch, go to a family wedding or reunion? Just because one turns 62 doesn’t mean they can’t enjoy life especially when they have equity in their home they can utilize.

Understanding Reverse Mortgages-A Book About Reverse Mortgages Take time to understand and have the facts. Those who do, see the reverse mortgage is not complicated but many faceted and they see the benefits it can bring to their lives.

If you’d like to understand and get the facts on reverse mortgags? Contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Reverse mortgage documents are a way to sign your own declaration of independence

Posted on July 3, 2018 by Beth Paterson, CRMP

sign your own declaration of independence with a reverse mortgage July 4th we celebrate Independence Day in America honoring the day our country signed the Declaration of Independence. Signing the reverse mortgage documents is a way for seniors 62 and older to sign their own declaration of independence.

Independence is defined as “freedom from the control, influence, support, aid, or the like, of others.” This fits senior’s attitudes, they want to maintain control of their life, make their own decisions and not depend on others for assistance.

Having one’s own funds for home repairs, going out to lunch with friends, traveling, visiting family across the country, purchasing a new car, paying medical bills or for medications; paying for help with housework, meal preparation, yard work or transportation, whatever is desired can give that feeling of independence.

Being able to pay off a mortgage to improve cash flow gives one relief and freedoms. Planning and have funds for the future and long-term care needs as well as protecting other assets and/or delaying taking out Social Security are other ways to have independence.

A new one-level home making it easier to age in place, moving closer to children yet remaining independent are made possible using a reverse mortgage HECM for Purchase.

Some assistance may be needed for seniors to remain in their home such as home care or medical equipment. However, not relying on children or the government for help and being able to choose a home care agency of their choice will give them the sense of independence. Using the equity in one’s one with a reverse mortgage can provide seniors the funds for their independence.

“Now I have my dignity back and my independence” was what Edna exclaimed after her reverse mortgage was closed.

Remain independent with a reverse mortgage Another Minnesota reverse mortgage borrower, Bea, said, “With a reverse mortgage you begin to have independence anew and you begin to feel more secure. Being free from monetary anxiety, you have better control over spending your equity.” The reverse mortgage allowed Bea to pay off a mortgage, then to travel to family weddings and reunions. Several years after she initially did her reverse mortgage Bea used her reverse mortgage funds to pay for home care that was needed to keep her independent and at home.

Ted, age 91 and Anna age 87, Minnesota homeowners, were proud and didn’t want to discuss their financial situation. However, their son-in-law finally talked to them about obtaining a reverse mortgage. When I met them and we started the reverse mortgage process, the children and I were told they were doing the reverse mortgage so they could put new linoleum on their kitchen floor. Once the loan was closed, I was informed by their children that they had indeed put in the new linoleum along with new windows and they bought some new furniture. The kids were going to Ted and Anna’s and were told, “Don’t pull in the drive way, we just had it blacktopped.” When Ted and Anna went out to eat with their kids, they could pay for their kid’s meals too making them feel good that they could treat their children to a meal.

While Ted and Anna were too proud to let their children know their financial situation initially and they didn’t want to depend on them to assist with their living expenses, once they signed the reverse mortgage documents they kept their independence and had funds for their needs and desires. This also improved their dignity.

Dorothy closed on her HECM reverse mortgage as a tool to strategically manage her assets. The benefits she received from her reverse mortgage include independence and security. She’s used the funds for home repairs & travel, & hasn’t had to use her investments.

A reverse mortgage insured by FHA, an agency within HUD, is known as a Home Equity Conversion Mortgage or HECM. As one of the most protected financial options available for seniors, it allows them to use the equity in their home for whatever they need or want.

Offering the most flexibility of payment options or no payment, with no monthly principal mortgage and interest payments required, cash flow can be improved by receiving money in monthly payments, a line of credit, lump sum or a combination of these. With the growth rate, the line of credit is a wonderful tool for retirement and long term care planing.

The title remains in the borrower’s name and the loan is generally not due until the home is no longer the primary residence of the borrower(s), when they die, sell or move or on their 150th birthday. Repaid from the sale of the property, as a non-recourse loan if the loan balance is higher than what the home can be sold at fair market value the borrower or their heirs are not responsible for the difference. If the home is sold for more than the amount due then the borrower or their heirs keep the difference.

Working with an estate planner, a reverse mortgage helped Mary plan her retirement so she has funds for emergencies, medical expenses, traveling, leaving something for her heirs, and enjoying life with independence and not be dependent on her children.

As you bring out the red, white and blue, hang your flags and gather with family to celebrate the independence of this great country of ours, discuss what independence means to your loved ones. What is needed to help seniors remain independent and in their home, not relying on the government or on their children? Then explore a reverse mortgage, get the facts about them, and see if it might be an option for your situation to maintain their independence.

You just might find, as over a million others have, obtaining a reverse mortgage may be just like signing your own Declaration of Independence – then celebrate your independence.

Happy Independence Day!

If you’d like to explore creating your own declaration of independence, contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

This material may be re-posted provided it is re-posted in its entirety and without modifications and includes the contact information, copyright information and the following link: https://wp.me/p4EUZQ-1QV

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Free Webinar on using a HECM for Purchase for your older home buyer’s

Posted on April 11, 2018 by Beth Paterson, CRMP

Using Reverse Mortgage to Purchase New Home The National Reverse Mortgage Lender Association (NRMLA) is hosting a free webinar on using a reverse mortgage to purchase a new home during the 3^rd annual Reverse Mortgage Education Week. Reverse Mortgage Education Week is dedicated to teaching more people about the benefits of reverse mortgages, how they work, and how loan proceeds can be used to support aging in place.

Typically older homebuyers aged 62 and older, who don’t usually qualify for a conventional mortgage, or want a monthly mortgage payment, would need to pay cash for their new home. However, there is another option, FHA’s Home Equity Conversion Mortgage (HECM) for purchase, H4P.

Seniors have used the H4P to purchase their dream home, downsize to a home more convenient for their changing health needs and move closer to their children.

Join us for “Serving the Boomer Market: Guidance for Meeting Older Buyers Needs with HECM for Purchase,” an informational webinar for Realtors and agents who work with older buyers. NRMLA CRMPs Chris Bruser and Christina Harmes, Realtor Scott Degnan, and Scott Owens the General Manager of an active adult community, will explain the process for using a reverse mortgage to purchase a home and provide examples of how buyers, and sellers, can benefit from H4P.

What: Free Webinar: Serving the Boomer Market: Guidance for Meeting Older Buyers’ Needs with HECM for Purchase
When: April 24, 2018, 1:00 – 2:00 PM ET
Registration: http://bit.ly/2GxO56u

For more background on reverse mortgage loans and HECM for Purchase, take a look at these resources and media coverage that shows how the responsible use of a reverse mortgage can enhance a retirement plan:

We Were Able To Use A Reverse Mortgage To Purchase Our Beautiful New Home
How Can A Reverse Mortgage Be Used In One’s Financial Plan?
A Minnesota Reverse Mortgage Borrower Speaks Out On The Benefits With Her Reverse Mortgage
NRMLA: Resources for Realtors® and Agents
Toolkit: Using a Reverse Mortgage to Buy a Home
Video Testimonial: Personal Financial Columnist Terry Savage Gets Personal
ThinkAdvisor: “Reverse Mortgages Could Be Next Hot Topic in Retirement Planning”
NRMLA: “Today’s Reverse Mortgages: Flexible with a lot of built in protections”
Kiplinger: “Reverse Mortgages That Work”
Wall Street Journal: “A Reverse Mortgage to Buy a Home? Here’s How”
US News and World Report: “Should Retirees Buy a Home with a Reverse Mortgage?”
CBS News: “A Smart Way for Seniors to Tap Home Equity”
Chicago Tribune: “Can a Reverse Mortgage Stabilize a Wobbly Retirement-Income Stool?”
Forbes: “Using a Reverse Mortgage in a Responsible Retirement Income Plan”
Kiplinger: “Why Reverse Mortgages are Worth a Look”

NRMLA’s Reverse Mortgage Education Week runs from April 23rd-27th. Check here for the calendar of all webinars.

If you’d like to learn how to utilize a reverse mortgage to purchase a new home, contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

How Can A Reverse Mortgage Be Used In One’s Financial Plan?

Posted on March 1, 2018 by Beth Paterson, CRMP

Using Reverse Mortgage for financial planning In a perfect world, ideally it is to not have debt of any kind including no mortgages, having a huge retirement portfolio to cover one’s lifestyle and long-term care costs.

However, in the real world, many who have thought they have saved for retirement find that when “life happens” they use those funds quickly. The reverse mortgage is a tool for planning for retirement and long-term care costs as well as more immediate needs. This way they have a plan and funds for when “life happens.”

Financial advisors, planners, insurance agents, wealth managers, estate planners, tax advisors and other financial professionals are realizing the value of using one’s home equity, especially the HECM reverse mortgage, to be part of one’s plan. There is even some discussion on the importance discussing the reverse mortgage as an option for one’s retirement plan by professors of finance at various universities.

Here are some ways a reverse mortgage could be utilized as part of one’s retirement plan.

Protect other investments/Hedge against longevity risk – With the reverse mortgage in place and having cash available, borrowers’ can protect their other investments and retirement portfolios to hedge against longevity risk if those decrease or not have to draw on those, especially in a down market. They can still have cash flow yet save the investments for future use or use those funds for an inheritance.

Eliminate current mortgage payment – By using the reverse mortgage to pay off the current mortgage it allows one to improve their cash flow and have more flexibility for their retirement planning. (Borrowers are still responsible for paying property taxes and hazard insurance.)

Payment flexibility – Payments on the reverse mortgage are not required. However borrowers can choose to make payments in an amount they choose and when they choose. If they use the reverse mortgage to pay off their current mortgage and then continue making payments, the payment will reduce the loan balance and be applied to their line of credit. The funds in the line of credit will grow, meaning they will have funds in the future to re-borrow without refinancing and having to pay closing costs again.

Another big plus with the payment flexibility is if one can’t make a payment because they are no longer working or have a medical expense, they will have better cash flow management.

Funds for emergencies and/or long-term care – The HECM Adjustable Rate has a line of credit option with a growth rate. Taking out the reverse mortgage at an earlier age and leaving the line of credit to grow will provide more funds for emergencies and/or later when it’s likely they will need long-term care.

Purchase a new home – Rather than using cash, other retirement funds or a conventional mortgage, the HECM reverse mortgage for purchase (H4P) offers a stronger strategy. See page 19 for more details.

Proceeds are not taxable income – Because it is a loan, the reverse mortgage proceeds are not considered income and therefore not taxable. Therefore one can draw from the line of credit and not have the tax liability unlike some other retirement investments may have.

Continue working but have funds when not able to – Doing the reverse mortgage with a line of credit now could mean more funds available in the future. Borrowers can choose to continue working but when they can’t work anymore, or choose not to, they could have funds to replace their income.

While working they could choose to make payments on their reverse mortgage but then stop making payments when no longer working and take monthly draws or draws as needed to replace their work income.

Social Security claims – With the reverse mortgage in place the proceeds could replace the Social Security income when one spouse passes and they lost the 2nd Social Security income. They could set up receiving monthly payments so their cash flow continues allowing them to maintain their lifestyle.

One could use reverse mortgage proceeds to delay taking Social Security as part of their plan meaning they would increase their monthly Social Security benefits. The CFPB has cautioned about this strategy. Borrowers should consult with their financial advisors to determine if this would be a strategy for them and what is best for their situation.

Available funds even with lower home value – Because the funds are guaranteed to be available based on the home value at the time of closing (FHA insurance benefit), if home values decline (remember 2008?), the reverse mortgage borrower could still have access to more funds than the value of the home and the line of credit will continue to grow even if the home value declines.

Not depend on children – If one needs addition funds for maintaining lifestyle, medical expenses, long-term care, etc, the reverse mortgage could provide funds so they don’t have to rely on their children.

If children want to tap their financial portfolio to help care for their parents, a reverse mortgage on the parents home may be a better plan; providing funds for the parents needs and preserving the child’s portfolio for their own future.

Long-term Care Insurance – One may not qualify for long-term care insurance or afford the premiums so the reverse mortgage line of credit could act as an “insurance” to cover the long-care needs.

If one does qualify for long-term care insurance, the reverse mortgage line of credit could provide funds allowing a higher long-term care insurance deductible and a longer waiting period before drawing from the long-term care insurance.

Payoff spouse in a divorce – The reverse mortgage can be used to pay off a spouse going through a divorce, allowing one spouse to remain in the home.

Use in probate – In the case of the death of a parent, the reverse mortgage could be used to pay off a sibling or siblings so one can remain in the home or purchase the family home. This is beneficial when one child has been living in the home and taking care of the parent(s), and wants to remain in the home.

I am not a financial planner/advisor, accounting advisor/CPA or an attorney. This information is provided as ideas to use for one’s plan. One should consult with their financial, accounting and/or legal advisor on what works for their situation.

If you’d like to improve your retirement cash flow now or for the future, contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Do You Realize How A HECM Reverse Mortgage Compares to A Conventional Mortgage?

Posted on January 24, 2018 by Beth Paterson, CRMP

Comparing HECM Reverse Mortgage to a Conventional Mortgage Most people have, or had, a conventional mortgage using them to purchase their home or have refinanced …yet the reverse mortgage is often misunderstood.

A reverse mortgage is a mortgage where the lender puts a lien against the property, just like conventional mortgage, but with special terms for those 62 and older.

The Home Equity Conversion Mortgage or HECM, the most common reverse mortgage is insured by FHA for the purpose of providing a valuable financing alternative for senior homeowners to help them remain in their home and have access to funds by withdrawing a portion of their home equity.

Let’s compare the two.

	Conventional/Traditional Mortgage	Home Equity Conversion Mortgage (HECM) Reverse Mortgage
Loan Collateral	It is a loan using the home as collateral.	It is a loan using the home as collateral.
Title/Ownership	The title stays in the borrower’s name, they remain the homeowner.	The title stays in the borrower’s name, they remain the homeowner.
Interest Rate	Interest rate can be impacted by one’s income and credit score. Limited income and poor credit means a higher interest rate.	Income or credit scores don’t affect the interest rate.
Qualifying	Income and credit history and scores are used to for qualifying; low income or and a poor interest may mean one doesn’t qualify for the conventional mortgage.	Income and credit history are used to for qualifying; to determine if borrowers meet HUD’s Financial Assessment requirements. If one has a history of late payments on debt and a low residual income a Life Expectancy Set Aside may be necessary. Under some circumstances they may not qualify.
Closing Costs	Closing costs include origination fee, appraisal, title and recording fees. If doing a “Forward” FHA Mortgage Insurance Premiums are charged. On conventional mortgage one may purchase Mortgage Insurance. Closing costs are comparable to reverse mortgages…I’ve done side-by-side comparisons. (Contact us for a copy.)	Closing costs include origination fee, appraisal, title and recording fees. FHA Mortgage Insurance Premiums are charged. Closing costs are comparable to any conventional mortgage…I’ve done side-by-side comparisons.

Loan Amount Borrowed

Amount borrowed is based on appraised value of home, credit score and program chosen.

Initial amount borrowed is based on the age of the youngest homeowner, appraised value or FHA Lending Limit, expected interest rate and program chosen.

Over time the amount borrowed increases with the interest rate, FHA Mortgage Insurance Premium and draws being added to the loan balance. At some point it is possible to borrow more than the value of the home at the time the loan was initiated.

If payments are made (they are optional), then they could decrease the loan balance.

Receipt of Funds

Conventional mortgage funds are drawn as a lump sum.

Home Equity Line of Credit (HELOC) creates a line of credit for a specific term and specific amount.

Can receive funds as monthly payments, line of credit, lump sum or a combination of these.

Line of credit grows so more funds become available over time.

Use of Funds

Borrowers purchase a home or refinance to have funds for what they need or want.

Borrowers benefit by having access to funds for whatever they need or want. It can be used for more immediate needs or as a financial planning tool or even to purchase a home.

Monthly Mortgage Payments

With a conventional mortgage or HELOC one has to make monthly mortgage payments. If the mortgage payments aren’t made, usually within 3 to 4 months, the foreclosure process will begin.

The advantage is they don’t have monthly mortgage payments to make which takes away the risk of foreclosure from not making a monthly mortgage payment.

Payment Requirements

Payments are required to be made. One has to refinance to access more funds.

Payments can be made, it’s a choice of the borrower as to when, how much, how often. Making payments reduces the loan balance.

With the adjustable rate the funds are applied to the line of credit and can be borrowed without refinancing.

Interest

Interest is paid each month along with the principal. Reducing the loan balance over the term of the loan.

If one has a balloon payment the full payment would be required at the end of the loan term…generally 10 to 15 years.

Interest is accrued over the life of the loan. This increases the loan balance over the term of the loan.

If one chooses to make payments, the loan balance will be decreased by the of payment made.

Borrower’s Responsibilities

Borrowers are responsible for keeping insurance on the property, paying property taxes and maintaining the home. As long as they abide by the terms of the loan they are not forced from their home.

If they don’t abide by the terms of the loan, they risk a foreclosure.

Borrowers are responsible for keeping insurance on the property, paying property taxes and maintaining the home. As long as they abide by the terms of the loan they are not forced from their home.

If they don’t abide by the terms of the loan, they risk a foreclosure.

Loan Term/Due Date

It is a loan and does need to be repaid over the life of the loan. A conventional mortgage loan term is generally 15 or 30 years. A HELOC’s loan term is generally 10 to 15 years.

It is a loan and does need to be repaid at the end of the loan term. The reverse mortgage loan is not due and payable until the home is no longer the primary residence of the borrower or on their 150th birthday. (Or if they don’t abide by the terms of the loan.)

Equity Difference When Sold

When the loan is being repaid, if the home is sold for more than the loan balance, the borrower or their heirs receive the difference.

Non-Recourse

Conventional loans can be non-recourse; it’s determined by the lender. Without the non-recourse factor the lender can be repaid from other assets of the borrower.

All reverse mortgages are non-recourse which means there is no personal liability to the borrower or their heirs. The loan is paid back only from the property.

FHA Mortgage Insurance Premium Covers

If the loan balance is higher than what the home can be sold for when the loan is due, the FHA Mortgage Insurance covers the difference to the lender; the borrower or their heirs or tax dollars don’t cover this difference.

Staying in home when all funds used

Borrowers stay in their homes even when all funds are drawn as long as they abide by the terms of the loan.

Once a reverse mortgage is in place, even if one draws all the funds available from the reverse mortgage, the borrowers can stay in their home as long as they abide by the terms of the loan, i.e. pay property taxes and insurance, HOA dues if applicable, and maintain the home.

Protections

No counseling required.

Requires counseling by a HUD approved 3^rd party counselor as a protection to help borrowers understand the details of the reverse mortgage. The processing cannot start until the counseling has occurred.

HUD regulates what lenders and third-parties may charge stating they must be customary and reasonable costs necessary to close the mortgage. Mark-ups are not allowed.

Disclosures and sample closing documents must be provided to borrowers at application.

Lender/Bank and Investor Benefit

Lender makes money on the interest.

Would you loan money without receiving a benefit?

Lender makes money on the interest.

Would you loan money without receiving a benefit?

Loan Officer Explaining Reverse Mortgage As with any financial product, or any purchase for that matter, one should get the facts and understand the terms.

The loan officer one is working with should be explaining the features and terms of the reverse mortgage. Yes, unfortunately there are bad apples in every industry but that doesn’t mean the product is bad. The reverse mortgage industry has implemented protections to prevent borrowers from scam.

Understanding reverse mortgages one might find the reverse mortgage is a more viable option for their situation.

For further details on the reverse mortgage contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible. For other states, contact your local reverse mortgage specialist who is a broker, one who works with several lenders, has their Broker License/NMLS and preferably holds the Certified Reverse Mortgage Professional (CRMP) designation.

Blog posts’ information is current as of date post published, program is subject to change in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Is it crucial to have no mortgage in retirement or wiser to do a reverse mortgage?

Posted on September 27, 2017 by Beth Paterson, CRMP

Using home equity for retirement cash flow I recently received a comment on a blog post saying that it is, “absolutely crucial that Americans reach the vocational finish line (retirement) with their personal residence being FREE & CLEAR!” Have you also thought this?

I challenge him, and you, to consider to whose perspective is it crucial? Your perspective, the homeowners’ or their heirs’ perspectives? Depending on the report referenced, it’s somewhere between 80% and 90+% who want to remain in their homes and age in place, but even if they want to relocate and downsize, being debt free is less important than living their lives with security, independence, dignity and control.

Statistics show a large majority of senior homeowners have mortgages that they have to pay monthly mortgage payments on. The debt payments can be a hardship for seniors. Fortunately with the reverse mortgage, the most common being the Home Equity Conversion Mortgage (HECM) offered by HUD and insured by FHA, monthly mortgage payments are not required.

Yes, the reverse mortgage is a debt but to be paid back when the homeowners are no longer living in the home as their primary residence. The reverse mortgage offers flexible payment options, borrowers can choose to make payments when they want, how much they choose to make or make no payment at all.

And yes, reverse mortgage borrowers are still responsible for paying property taxes, hazard insurance and if applicable, HOA dues. But these expenses are part of the responsibility of home ownership whether there is a reverse mortgage, traditional mortgage, HELOC or no mortgage.

The reverse mortgage is a non-recourse loan, which means there is no personal liability to their borrowers or their heirs.

Home equity is a retirement nest egg and to use it for retirement cash flow there are two options, 1) sell it (but then where are they going to live and have improved cash flow for a longer term and for long-term care planning?) or 2) leverage the home equity with a reverse mortgage. The line of credit option with the HECM offers a growth rate which is not available with any other loan.

Reverse Mortgages can be used for Retirement Planning Financial advisors are suggesting using reverse mortgages for retirement planning: Wall Street Journal points out that advisers are now promoting reverse mortgages as a valuable tool for retirement planning in their article “New Math on Reverse Mortgages.”

As Wade Pfau, Professor of Retirement Income at The American College in Bryn Mawr, PA and a Principal and Director for McLean Asset Management, states in his article, Forbes: Wise Reverse Mortgages Can Be the Saving Grace of Unprepared Retirees, “…that is the nature of retirement income efficiency: using assets in a way that allows for more income and/or more legacy.”

According to Jamie Hopkins, Co-Director of the American College’s New York Life Center for Retirement Income and an Associate Professor of Taxation at the American College, in Forbes, Reverse Mortgages Can Be A Retiree’s Saving Grace “Robert C. Merton, a finance professor at MIT’s Sloan School of Management, recently stated ‘Americans have wrongly steered clear of reverse mortgages.’”

Even with the HECM changes going into effect on October 2, 2017, the reverse mortgage can be a valuable tool in retirement as it always has been.

In the real world a Reverse Mortgage is another planning tool In a perfect world, ideally it is to not have debt of any kind including no mortgages, having a huge retirement portfolio to cover one’s lifestyle and long-term care costs.

However, in the real world, many who have thought they have saved for retirement find that when “life happens” they use those funds quickly. The reverse mortgage is another tool for planning for retirement and long-term care costs as well as more immediate needs. This way they have a plan and funds for when “life happens.”

If you’d like to improve your retirement cash flow now or for the future, contact us if you are in Minnesota. As your local broker, we work with several lenders and provide FREE information and facts with NO OBLIGATION, meeting in person whenever possible.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Solving The Reverse Mortgage Puzzle For You

Posted on August 10, 2017 by Beth Paterson, CRMP

Solving Reverse Mortgage Puzzle I’ve always loved doing puzzles and problem solving whether doing jig saw puzzles or finding resources and solutions to various issues. Much of this led me to the reverse mortgage industry back in 1999. Unfortunately, I come across many who still find the reverse mortgage puzzling. So let me help solve this puzzle for you.

We assisted solving Marion’s puzzle. Recently widowed, Marion’s income changed because with the passing of her husband she was now only receiving one Social Security check. Having recently moved to a new home, she did the reverse mortgage to do some updates on her home and improve her cash flow into her future retirement years.

The majority of seniors want to remain in home. Depending on report, it’s somewhere between 80% and 90+%. A reverse mortgage is an option to help them remain in their home and have improved cash flow for current or future needs.

A reverse mortgage is a mortgage like any other mortgage where borrowers retain title and borrow against their home equity, but the reverse mortgage offers special terms for seniors home owners 62 and older.

The Home Equity Conversion Mortgage, or HECM, is the most common reverse mortgage and only one available in Minnesota. The HECM was first insured by FHA in 1989 for the purpose of providing a valuable financing alternative for senior homeowners to help them remain in their home and have access to funds by withdrawing a portion of their home equity.

To determine the Principal Limit or the maximum funds available at closing, HUD’s formula is the age of the youngest borrower or non-borrowing spouse, the Expected Interest Rate, the program chosen and the lower of the home value or FHA Lending Limit, currently $636,150, or in the case of a home purchase or home purchased in the last 12 months, the lower of the appraised value or purchase price.

Borrowers must meet HUD’s Financial Assessment requirements to qualify which means we obtain documentation demonstrating their ability and willingness to pay property taxes and insurance into the future. In some circumstances a Life Expectancy Set Aside (LESA) may be required to cover the property taxes and insurance.

The net amount available is based on the Principal Limit, less closing costs, paying off any mortgages, liens and/or judgements, and the LESA if required.

If all available funds are used to pay off current mortgages or liens, the borrower’s cash flow will still improve because the monthly mortgage payment is eliminated.

Unlike other mortgages, an advantage for seniors is with the reverse mortgage there are no monthly payment requirements although borrowers are responsible for paying property taxes and insurance. While monthly payments aren’t required, one can make a payment or payments when and how much they choose.

The interest rate depends on the program chosen and is either adjustable or fixed. While an adjustable rate often scares people, that is because on a conventional mortgage if the interest goes up, so does one’s payment. With the reverse mortgage, because monthly mortgage payments are not required, this is not a factor. It only impacts the amount that needs to be repaid when the loan is due and payable.

Offering more flexibility with the Adjustable Rate option, the funds available can be received in a lump sum, monthly payments, a line of credit or a combination of these. The monthly payments can be structured as one needs (term) or for life as long as the home is the primary residence (tenure). Funds in the line of credit grow so more funds can be available in the future. The line of credit growth rate is a feature that makes the reverse mortgage a tool for financial and long term care planning.

The fixed rate option requires funds to be pulled only as a lump sum draw. The draw amount is limited to the 60% of the Principal Limit (an additional 10% is available in some circumstances).

Because the closing costs are up-front, they are often perceived as high. On conventional mortgages people usually focus on the payment and interest rate, not really looking at the closing costs so they don’t realize the costs are comparable. However, reverse mortgage closing fees are comparable to the traditional closing costs of a conventional loan including an origination fee, appraisal, title fees, title insurance and recording fees. As a Federal Housing Administration (FHA) insured loan, with the HECM borrowers also pay the FHA Mortgage Insurance Premium (MIP).

The FHA MIP offer significant benefits for reverse mortgage lenders, investors, as well as the borrowers.

The insurance protects the investors against risk and loss.

There are also advantages and increased borrowing power for the borrowers with FHA insuring the reverse mortgage. These include:

Guaranteeing the funds are available for you, the borrower, during the term of the loan. With HELOCs the bank/lender can call the loan due and payable if there are changes with the bank, for example they merge with another bank/lender or they close their doors. Insured by HUD, HECMs are still available even if something happens to the lender.
Guaranteeing the reverse mortgage lender against default or shortfalls means the interest rates are lower compared to other mortgages for the benefits one receives with the reverse mortgage. i.e.,
- With conventional loans the interest is impacted by one’s credit score. With the reverse mortgage one’s credit, even if it’s poor, does not impact the interest rate.
- The FHA insurance on the HECM loans keep the interest rate low and allows more dollars to be loaned than with proprietary programs. Proprietary reverse mortgage programs have a higher interest rate to cover the lender’s and investor’s risks and loss.
Providing a line of credit growth rate (available only with reverse mortgages). The tenure monthly payment option also has a growth rate factored in when the tenure payment is calculated.
As a reverse mortgage it is a non-recourse (no personal liability) loan. What this means is if the loan balance on the reverse mortgage is higher than what the fair market value is on the home when the loan is due and payable, the FHA MIP will cover the difference to the lender rather than the borrowers or their heirs having to come up with the difference.

When the loan becomes due and payable, generally when the borrowers pass away, sell or move, the repayment amount is the lesser of the loan balance or fair market value of the home. If there is remaining equity, it goes to the borrowers or their heirs. As a non-recourse loan there is no personal liability to the borrowers or their estate for repayment. If an heir wants to keep the home, they can do so by paying off the reverse mortgage loan balance.

Lee who had some credit card debt, and while still working and having some retirement accounts he needed improved cash flow and didn’t want to tap the retirement accounts. Doing the reverse mortgage allowed him to access cash to pay his credit card debt and do some home improvements. It also meant he didn’t have to pull funds from his retirement accounts, but leave those for the future, maybe even being able to leave his heirs some funds. And with the reverse mortgage line of credit, when he does retire, he’ll still have some funds available to replace his income.

Sometimes there are situations that pose puzzles during the process that I face in order to be able to do the loan for borrowers. Through my experience and knowledge of the product and industry along with my problem solving skills, I work hard to solve the puzzle and will do so if at all possible.

Another puzzle we helped solve was for Marilyn. During the probate of her mother’s estate, Marilyn wanted to keep the family home. Sorting through the process of the probate and transferring the home’s title to Marilyn, the reverse mortgage provided the funds to pay her siblings their shares of the estate so she could keep the home and live there as her primary residence.

Reverse Mortgage Puzzle Solved If you’d like to improve your retirement cash flow now or for the future and want to solve the reverse mortgage puzzle, contact us if you are in Minnesota. As your local broker, we work with several lenders and provide free information and facts with no obligation, meeting in person whenever possible.

Blog posts’ information is current as of date post published, program is subject to change in in the future. Contact us for current information, 651-762-9648.

This site or the information provided is not from, or approved by, HUD, FHA, or any US Government or Agency.

Minnesota Reverse Mortgages SIDAC

Minnesota Reverse Mortgage Information, Facts and News from the Experts Excelling in Service

Tag Archives: Minnesota Reverse Mortgage

How Much Can You Borrow With A HECM Reverse Mortgage?

Reasons to obtain a Reverse Mortgage

HECM Reverse Mortgages and Non-borrowing Spouses, What You Need To Know

Reverse Mortgages are not complicated; but are multi-faceted

Reverse mortgage documents are a way to sign your own declaration of independence

Free Webinar on using a HECM for Purchase for your older home buyer’s

How Can A Reverse Mortgage Be Used In One’s Financial Plan?

Do You Realize How A HECM Reverse Mortgage Compares to A Conventional Mortgage?

Is it crucial to have no mortgage in retirement or wiser to do a reverse mortgage?

Solving The Reverse Mortgage Puzzle For You