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Birthday coming - John Gear Law Office turns 7 on 1 September

8/28/2017

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The Banks Don't Want You to Be Able to Stand Up Against Them

8/28/2017

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Click on Image to go to NCLC website where you can download as pdf
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Things to read up on before taking out a reverse mortgage, to delay social security or any other reason

8/24/2017

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Things to consider before borrowing a reverse mortgage to delay collecting Social Security
By Stacy Canan – AUG 24, 2017

For most people, the amount of money you bring in each month decreases after you retire. Yet your expenses, particularly for health care, may not follow suit. So the question on the minds of many approaching this life stage is: how do I replace or supplement my monthly income when I retire? 

The most obvious answer might be to claim your Social Security retirement benefits. If you qualify for Social Security retirement benefits, it’s important to think about the best time to claim your benefits. For most people, eligibility for full benefits is between age 66 and 67, depending on the year you were born. Alternatively, you can start to collect benefits as early as age 62, but if you choose to claim early, your monthly benefits may be reduced as much as 30 percent. You can also delay and claim at age 70 to get your maximum monthly benefit.   

With that in mind, some financial professionals are increasingly promoting that older homeowners consider borrowing a reverse mortgage loan at age 62 in order to delay collecting Social Security. This approach suggests that you use proceeds from the loan to replace the Social Security benefits that you would otherwise receive if you had started collecting Social Security at age 62 until your full benefits age, or later.  

We looked at different scenarios involving older homeowners for whom their home and Social Security are their main resources and found that generally they are better off if they take their Social Security benefits rather than taking out a reverse mortgage. This is true because, in general, the cost of a  reverse mortgage loan will exceed the additional amount of increased Social Security benefits you would collect over your lifetime. That’s because the interest and fees you pay increase each month, and over time those costs wipe out the additional benefit obtained by delaying.  

When you borrow a reverse mortgage loan, your home is used as a guarantee for the loan, like it is in a traditional mortgage loan. But unlike a traditional mortgage, a reverse mortgage loan is usually repaid  when the borrowers no longer live in the home. You won’t make monthly mortgage payments, but you must stay current on paying your real estate taxes and homeowner’s insurance. There are other conditions of the loan that must be met too. If you don’t meet the conditions, the lender can foreclose on your home.

If you have the option, working past age 62 is usually a less costly way to delay claiming than borrowing a reverse mortgage loan would be. The additional years of work often provide you more time to save and pay off debts. It may also result in an increase in Social Security benefits by replacing years with low or no earnings, if any, from your earnings record.

For those who can’t continue to work, it may be better to accept a lower Social Security benefit amount, rather than owing on a reverse mortgage loan in the future. In addition, the effects of using a reverse mortgage loan to delay collecting Social Security benefits would likely reduce the equity in your home. This loss in equity could limit your options for moving to a new location or handling a large financial shock in the future.

We looked at different scenarios involving older homeowners for whom their home and Social Security are their main resources and found that generally they are better off if they take their Social Security benefits rather than taking out a reverse mortgage.


New resources

We released three new resources to help older homeowners learn what a reverse mortgage is and decide whether borrowing a reverse mortgage is right for them: 


  • An issue brief that explores the tradeoffs of borrowing a reverse mortgage loan in order to delay claiming Social Security
  • A discussion guide designed to be used as a primer on reverse mortgages and to help homeowners considering a reverse mortgage prepare for their discussion with a HUD-approved housing counselor
  • A short video that provides key information about the features of a reverse mortgage

If you have a problem with a reverse mortgage, you can submit a complaint online or call us toll free at (855) 411-CFPB (2372), Monday through Friday, 8 a.m. to 8 p.m. ET. We provide complaint-handling services to people in more than 180 languages and to those who are deaf, have hearing loss, or have speech disabilities through the our toll-free telephone number.

(This material reposted with permission from the federal Consumer Financial Protection Bureau blog).

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Fight Hunger with Beauty! Come to Empty Bowls 2017

8/23/2017

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     For the 7th consecutive year, John Gear Law Office is proud to sponsor the "Empty Bowls" sale at Willamette Art Center, a key yearly fundraiser for Marion-Polk Food Share and our whole community.
    Always the weekend before Thanksgiving, "Empty Bowls" is where you can find top-class craft art, full of creativity and beauty, by local artists, donated to be sold for very low prices, all to fight hunger. Bring your family and friends and all your holiday shopping lists.
     As always, Empty Bowls is the weekend before Thanksgiving at Willamette Art Center on the State Fairgrounds in NE Salem (Yellow gate - Silverton Road entrance).
   

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New Barbooks Attorney Practice Manual for Helping Military & Veterans

8/10/2017

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I am proud to have been asked to help write a chapter in the Oregon State Bar's newest practice guide for attorneys, this one aimed at helping attorneys with representing active-duty servicemembers and veterans.

I got to work with a very bright younger attorney and I think that we delivered something that will help Oregon attorneys who have never served more easily find and use the special statutory protections for servicemembers and veterans in federal and Oregon law.

Pop Quiz: 

Q: What's the difference between a fairy tale and a sea story?

A: The fairy tale begins "Once upon a time ..." and the sea story begins "When I was on the (ship name) . . . "
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Just 3 of the Biggest Lies Bank Lobbyists Use to Say FU to Accountability

8/3/2017

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Great article in The Hill about three big lies the Big Banksters are pushing to persuade Congress to keep consumers from being able to bring class actions against banks who rip off people millions at a time.

An excerpt:


Big Lie No. 2: Class actions only benefit the attorneys.

The CFPB studied 419 consumer financial class actions and found $2.7 billion in relief for consumers, with only 18 percent of that going to attorneys. That is, $2.2 billion went to consumers. The math I was taught says that $2.2 billion is a pretty big benefit and is a lot more than the attorneys got.

Lawyers who represent consumers work for years without pay, fighting against mega-banks, and when they win, they are paid for doing their jobs. I don’t hear lobbyists complaining about the money Wall Street lawyers make fighting against these cases and dragging them out — even in arbitration (link).

What's more, I bet the average person would rather see the consumer lawyers get paid for holding banks accountable than let a bank illegally take $100 each from a million people.


A few anecdotes about class actions when held up against the CFPB’s extensive data don’t justify taking away everyone’s day in court. The CFPB's extensive data about the benefit of class actions for consumers also refute any anecdotes about supposedly frivolous lawsuits.

Should we make all industry debt-buyers (a form of debt collector you never want to meet) give up the right to file lawsuits because some (many) sue the wrong person, seek the wrong amount or file suits after the statute of limitations has passed?
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Good Advice from CFPB - the only agency looking out for real people

8/1/2017

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We often hear that older Americans want to "age in place." Aging in place means living at home in the community, rather than in an institutional setting, like a nursing facility. This is the choice most people want to make even if they need services and support to do so. 

With over ten thousand people turning age 62 every day, and with a majority of them homeowners, a growing number of businesses are increasingly using the phrase aging in place to market financial products and services to homeowners in the baby boom generation. Many reverse mortgage lenders, for example, advertise that a reverse mortgage loan will enable you to continue living in your current home so you can age in place. 

Many of these businesses and lenders, however, are incorrectly implying that staying in your current home is the only option for aging in place. 

Although the promise of staying put is attractive to many, remaining in your current home may not be a good plan for everyone. For example, your home may have many stairs, be expensive to heat and cool or repair, require costly taxes and insurance payments, have limited or no public transportation nearby, or be far from family, friends, and community activities.

Though it’s hard to envision an older you, think about what you want to be doing and what you can afford to do in ten, twenty, or more years from now. If you’re in your sixties, there’s a good chance you’ll live into your eighties or your nineties. 
Here are some things to consider if you’re thinking about aging in place in your current home:


  • Will you be able to keep up with home maintenance, repairs, taxes, and other costs over time?
  • Will you be living near family or friends when you may need their help? 
  • Does staying in your current home give you the freedom to do the things that you like to do, such as traveling?
  • Will you be able to get to the places you want or need to go, such as to doctors’ appointments, friends’ homes, and places of worship, if your ability to drive becomes limited?

Before borrowing a reverse mortgage loan to pay for expensive home modifications or for other expenses to stay in your current home, consider all available housing options. There are many ways to age in place. Whether you live in the same home you’ve been in for decades or in a new place that fits your current needs, aging in place, most importantly, is about your right to live independently in the community of your choice.

The new marketing pitches can appeal to the emotional ties we have to our homes. It’s hard to imagine leaving a home you’ve lived in for many years, even if growing older in your home no longer makes sense. Moving can be overwhelming if you’ve lived in your home for many years, raised children there, or accumulated a lot of stuff over the years. If you’re nodding your head as you read, you’re likely the precise demographic that these businesses are targeting. 

Try not to let emotions or worries influence a decision that could put at risk your future financial, as well as your physical, well-being. Think about what makes sense for an older you, both personally and financially. Some decisions you may make about your home today may limit your options down the road, which in turn may prevent you from aging in the place you most want to be.

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LAWYERLY FINE PRINT:

John Gear Law Office LLC and Salem Consumer Law.  John Gear Law Office is in Suite 208B of the Security Building in downtown Salem at 161 High St. SE, across from the Elsinore Theater, a half-block south of Marion County Courthouse, just south of State Street. There is abundant, free 3-hour on-street parking throughout downtown Salem, and three multi-story parking ramps that offer free customer parking in downtown Salem too.

Our attorneys are only licensed to practice law in Oregon. This site may be considered advertising under Oregon State Bar rules. There is no legal advice on this site so you should not interpret anything you read here as intended for your particular situation. Besides, we are not representing you and we are not your attorneys unless you have hired us by entering into a representation agreement with me. While we do want you to consider us when you seek an attorney, you should not hire any attorney based on brochures, websites, advertising, or other promotional materials.  All original content on this site is Copyright John Gear, 2010-2022.

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