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Hi, I am Ethan Ewing, President of Bills.com and I wanted to share with you couple of recent
events in the mortgage world that will have an effect on borrowers. Certainly the first
one is, coming October 1, so it is not quite here yet, we are in mid September now, but
it affects reverse mortgages. Now reverse mortgages are products that are designed for
older home owners who have some equity in their home and are looking to either receive
additional income or pay down some debt, whatever it is, great product for the right person
and the right situation. What's happening to reverse mortgages is HUD -- Housing and
Urban Development, the Government organization that monitors this program is actually reducing
the allowable loan to value on these loans. What that means is that as a borrower you
are now going to be able to, effective Oct 1, borrow less money than you are today. So,
if you are considering a reverse mortgage, do it in the next couple of weeks to really
maximize the amount of money you can take out, now keep in mind the reason the Government
is doing this is to really try to keep these loans from going bad so it is probably a positive
thing overall for the industry, but if you are a borrower and would lke to maximize the
amount of cash you can take out, do it in the next could of weeks. Second point is,
the FHA Mortgage Insurance premium was, at the beginning of the month, was actually increased
by about 20% now again what this means is FHA loans are historically, the reason they
are so popular is for purchasing home they required less of a down payment a lower down
payment, what the increased mortgage insurance premium does it requires more upfront . It
basically says to the borrower, hey we need you to pay more upfront to cover potential
losses down the road, so again, if you are a potential borrower looking to buy a house
and looking at a FHA loans your cost just went up 20%, so keep that in mind, not much
you can do about it now, but just help you to better prepare. That's it, have a great
week and we will see you next time.