User:John B Frazier

John B Frazier

There now exists another alternative to the reverse mortgage called a TIC ROOF offered by Fractional Equities, llc. The following is a comparison of a TIC ROOF(TM) (Tenant-in-Common Residential Owner Occupied Fractional-ownership) agreement to a reverse mortgage:

The Same

Reverse Mortgage						TIC ROOF (TM)

Tax free funding						Tax free funding Not related to income					       Not related to income You cannot be forced to move				       You cannot be forced to move Must be owner-occupied					       Must be owner-occupied You pay for insurance, taxes and maintenance	               You pay for insurance, maintenance and taxes Title insurance is required					Title insurance is required Heirs are required to repay debt	                       Heirs are required to liquidate a TIC ROOF Heirs are not required to sell the home			       Heirs are not required to sell the home

But Different (One is Debt)

A Reverse Mortgage is government regulated		       A TIC ROOF is a private transaction A Reverse Mortgage is a loan against equity			A TIC ROOFTM is NOT a loan Interest - often at a variable rate (ARM!)		       No interest Loan payments but no bills 					No payments Two liens against your home					No liens against your home Substantial Servicing Fee Set-aside				No servicing fee set aside

The existing mortgage must be paid off	                       The existing mortgage may remain in place Your debt will have to be repaid				There is no debt Variable interest rate determines amount available	       Amount available determined by home value The loan must be repaid	                                       The investor doesn’t receive any money until home sale

Closing costs may be included in the loan	               Closing costs are paid, there is no loan

The loan amount is determined by your age	               There is no loan and no age stipulation

Interest on loan comes out of your equity continually	       Equity expense is one time with no interest, ever

Loan costs w/fees average between $10-21,000, 	 	       Origination fee total averages between $2,000 including mortgage insurance & set asides			                and $4,000, no mortgage insurance or set aside

The loan must be repaid by your heirs out of your		There is no loan, your estate is not estate 								impacted by liquidation of the warranty deed

Servicing fee automatically charged each month	               NO monthly servicing fee

You can lose your home to the lender	                       You CANNOT lose your home to a lender

Different Benefits

Provides cash							Provides cash without debt You retain title to your property				You and the investor are tenants-in-common Maximum loan amounts in force				       Maximum amount determined by equity

Different Requirements

Age Requirement: 62+					       No age requirement

Loan amount determined by current interest rate		       Current interest rate irrelevant

Income from a reverse mortgage may impact other 		No income is received and origination expenses sources of income (assistance). may have tax benefits.

Counseling with a HUD approved counselor required	       No counseling required

Certificate expires in 180 days	                               No certificate required

Mortgage insurance and set aside required			Mortgage insurance & set aside NOT required

Children holding joint tenancy under 62 not allowed	       Children holding joint tenancy under 62 OK

Mortgage broker must be involved				Mortgage broker optional