New Data Shows That Economy and Higher Reverse Mortgage Limits Are Driving Seniors to Seek More Immediate Cash Benefits

OAKLAND, CA--(Marketwire - August 10, 2009) - Golden Gateway Financial, a comprehensive financial resource for seniors and retirees, today released new usage data from its online Reverse Mortgage Calculator that showed senior citizens are increasingly considering larger up front payments as opposed to more substantial monthly payments. In part, these larger payouts are available because of temporarily increased lending limits. The current recession has also likely influenced seniors to seek immediate relief versus betting on longer-term stability.

Data from the second quarter of 2009 shows similar numbers in terms of the types of individuals researching reverse mortgages. Average age of users, the percentage with forward mortgages, and current self-reported home values all remained relatively flat between the first and second quarters of 2009.

The one notable change was in how people are considering receiving their reverse mortgage proceeds. For those considering a larger up front payment, the amount continues to grow with an increase of more than $12,000 from the second quarter of 2008 to this year. For those considering a monthly term payout, the amount they are planning to withdraw each month decreased by nearly 50 percent in that same period.

"As we approach what appears to be the bottom in the housing market for seniors, the new reverse mortgage loan limit and a home price rebound means many could gain more now from a reverse mortgage than ever before," said Eric Bachman, founder and CEO of Golden Gateway Financial. "It's also evident that many of these same seniors are still feeling economic pressure and hope to alleviate it in the near term by taking larger up front payments and smaller monthly amounts."

New legislation temporarily increased the reverse mortgage limit available to homeowners in 2009 to $625,500. This means that many seniors can now extract even more equity from their home as cash in a reverse mortgage. At the same time, the latest S&P/Case-Shiller Home Prices Indices(1) showed that home prices are once again beginning to climb. Together, these two factors have provided seniors with a short window in which they can potentially earn more from their available equity than before and more than they might be eligible for next year.

Additional observations from the data include:

-- Age and other determining factors remained roughly consistent, while home values dropped by 1.4%, or an average of nearly $6,000, on a national average between the first and second quarters of 2009 -- The percentage of borrowers with a forward mortgage remained almost identical, meaning there is potentially an even split between those researching a reverse mortgage for reasons related to their homes versus their investment portfolio -- The amount of max up front payment available increased by 4.8% between the first and second quarter of 2009, and by 8.2% from the second quarter of 2008 -- The amount of max monthly payments available decreased by 2.9% between the first two quarters of this year, and by 48% between the second quarters of 2008 and 2009

Reverse Mortgage Calculator National Averages Q1 '09 Q2 '09 Q2 '08 ---------- ---------- ---------- Average age 69.5 69.3 69.5 ---------- ---------- ---------- Average home value $ 413,371 $ 407,557 $ 438,461 ---------- ---------- ---------- Percent with existing mortgage 49.9% 49.8% 53.4% ---------- ---------- ---------- Average existing mortgage debt $ 161,265 $ 152,455 $ 159,700 ---------- ---------- ---------- Average max up front payment $ 143,872 $ 151,089 $ 138,657 ---------- ---------- ---------- Average max monthly payment $ 396 $ 384 $ 739 ---------- ---------- ----------

* For state specific data, please contact Golden Gateway Financial

Golden Gateway Financial's award winning online reverse mortgage calculator has been recognized as an important resource for seniors by the Wall Street Journal. It allows users to enter basic information to configure reverse mortgage loan parameters and then compare lenders based on those fields. Golden Gateway Financial makes anonymous and aggregated data from these basic entry fields publicly available on a quarterly basis.

Golden Gateway Financial recently launched a new Reverse Mortgage for Purchase Calculator to offer borrowers assistance in understanding how changes in federal reverse mortgage guidelines could help them.

For more information about reverse mortgages or to access Golden Gateway Financial's industry-leading suite of online retirement assessment tools and resources, please visit http://www.goldengateway.com.

About Golden Gateway Financial

Golden Gateway Financial (http://www.goldengateway.com), located in Oakland, California, is a comprehensive resource for senior citizens, baby boomers and soon-to-be retirees to assess their financial health at retirement. Through a unique set of online tools and clear and unbiased communication, the company helps individuals address "The Great American Retirement Dilemma." The tools enable users to better assess the security of their nest egg and to make intelligent choices to fully enjoy what should be the best years of their lives. The company also operates the industry's premier reverse mortgage and life settlement services with innovative new calculators and products for each, and a team of trained counselors to help seniors better understand the products and evaluate whether they are right for them.

(1) Home Price Declines Continue to Abate According to the S&P/Case-Shiller Home Prices Indices (Press Release), Standard & Poor’s, July 28, 2009