Many homeowners have found that a reverse mortgage loan is a great way for them to take advantage of the equity they have built up in their homes.
A reverse mortgage loan is different than a traditional mortgage. With a traditional mortgage loan you make monthly mortgage payments, but with a reverse mortgage loan the lender pays you money through monthly installments, a one-time lump sum payment, a line of credit or a combination of a line of credit and monthly installments. The money that you receive is dependent on your age, the value of your home and the current interest rate.
One of the great advantages of a reverse mortgage loan is that you are not required to pay the loan back until the home is no longer your primary residence or you fail to maintain the home, or fail to pay property taxes and/or homeowner's insurance or do not otherwise comply with the terms of the loan.
If you’re aged 62 or older and own your home you might be eligible for a reverse mortgage loan. Contact us to find out more about reverse mortgage loans and ways to make it work for you, or Application questions and start the process of tapping the equity in your home.
Check out these pages for more information about reverse mortgage loans.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
You’ve worked hard to pay the mortgage on your home. With a reverse mortgage loan you can receive a portion of the equity that you earned. A federally insured HECM reverse mortgage loan can help you unlock that equity by increasing your monthly cash flow. Rest easy knowing you’re protected because with a reverse mortgage loan you can:
CFPB: responsibilities of a HECM reverse mortgage borrower
Speak with one of our professionals today and learn how you can make the most of a reverse mortgage loan.
If you're ready to get started on your reverse mortgage loan - Application questions.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
A reverse mortgage loan is a loan designed to allow seniors to draw upon the equity in their homes. Seniors can select to receive the loan proceeds either by a lump sum payment, by monthly installments, as a line of credit or as a combination of a line of credit and monthly installments thus providing cash flow even after retirement. The reason this type of loan is called a “reverse mortgage loan” is because the loan proceeds are paid to the home owner.
Eventually the money paid to the homeowner is repaid with interest, however the loan generally does not become due until the borrower passes away, sells the home, no longer maintains the home as the primary residence or fails to pay property taxes, fails to pay homeowners insurance or otherwise fails to comply with the loan terms.
Getting a reverse mortgage loan is a big step and needs to be carefully evaluated. Many people have found that by taking a reverse mortgage loan they avail themselves of the equity they have built in their home.
Typically those who benefit most from a reverse mortgage loan are those who plan to stay in their homes over an extended period and have built a decent amount of equity in their homes.
Contact one of our professionals today to find out if you have enough home equity to make a reverse mortgage loan a good decision for you. If you have a good amount of equity in your home and you plan on staying there for an extended period of time then a reverse mortgage loan might be right for you.
If you own your home and are 62 years of age or older you might be eligible to apply for a reverse mortgage loan. The home you are thinking of taking the reverse mortgage loan out on must be your primary residence. There are some conditions to what type of home may qualify.
We can help you figure out if you’re eligible for a reverse mortgage loan. Call us today! If you're ready to get started on a reverse mortgage loan Application questions!
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
Research reverse mortgage options, then discuss the choices with a HUD-approved counselor. For a HECM, counseling is required before receiving the loan. Ask the counseling agency about its fee and compare the proceeds, costs, and repayment conditions before applying.
Step 3 — Discuss the application process. After comparing options, ask about the application and required documents. This page does not collect or transmit an application.
Step 4 - Your application is processed and your home is appraised
While your application is being processed a licensed appraiser will determine if your house needs any kind of repair. Any problems must be fixed before you can be approved.
Step 5 - Your loan reaches underwriting
All details are worked out and your loan is underwritten. Additionally it will be determined whether you’ve been approved or not.
Step 6 - Your loan reaches closing
Once you are approved your loan will enter closing where you’ll get the chance to review the terms and sign the paperwork.
Step 7 - Receive your payments
After closing you’ll have three business days in which to cancel the loan. Once that grace period is up, you’ll start to receive the reverse mortgage loan proceeds according to the manner that you have elected: one-time lump sum payment, monthly installments, as a line of credit or as a combination of a line of credit and monthly installments.
Step 8 - Repaying your Reverse Mortgage Loan
Your reverse mortgage loan becomes due under the following circumstances.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
The very nature of a reverse mortgage loan can be confusing. With a reverse mortgage loan, lenders pay you either in monthly installments, with one lump sum, a line of credit or as a combination of a line of credit and monthly installments. The following lists provide information regarding repayment of a reverse mortgage loan.
A reverse mortgage loan comes due when under the following conditions:
When the reverse mortgage loan becomes due there are two options for paying it off.
Like all loans a reverse mortgage loan does carry conditions in order to remain valid. Reasons a borrower may find themselves in default include:
To apply for your reverse mortgage loan click here.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
Much like a traditional mortgage, a reverse mortgage loan does have fees associated with securing it. The following is a list explaining common fees you may have to pay when getting your reverse mortgage loan.
Origination Fee – The origination fee covers the lenders operating expenses associated with making the reverse mortgage loan. This can include things like overhead, marketing and title searches.
A lender can charge a HECM origination fee up to $2,500 if your home is valued at less than $125,000. If your home is valued at more than $125,000 lenders can charge 2% of the first $200,000 of your home's value plus 1% of the amount over $200,000 up to a cap of $6,000.
Appraisal Fees – Before a reverse mortgage loan can be approved an appraiser will come to your home and inspect it. The appraiser will be looking to determine the worth of your home based mostly on condition, location and the current market situation.
If the appraiser uncovers a significant problem you will be required to hire a contractor to fix the problem before obtaining your reverse mortgage loan. That same appraiser will come out again and re-inspect the property.
Mortgage Insurance Premium — A HECM includes upfront and ongoing mortgage insurance charges. Ask for the amounts applicable to the proposed loan, and compare them with origination, appraisal, and other closing costs. See the CFPB explanation of HECM costs.
Compare how each charge affects the funds available and the balance to be repaid. Mortgage insurance does not replace homeowners insurance or the obligation to pay property taxes and maintain the home.
Closing Costs – Closing costs that are generally included in a reverse mortgage loan are:
Application questions to get started with your reverse mortgage loan application.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
| Decision | What to put beside it |
|---|---|
| Lump sum, installments, or credit line | The expense you need to cover and when you need the funds. |
| Funds available | Origination, appraisal, insurance, and other closing costs. |
| Staying in the home | Property taxes, homeowners insurance, maintenance, and the loan’s occupancy conditions. |
| Moving, selling, or death | The repayment plan and the conditions affecting a surviving borrower or spouse. |
Work through these questions with the counselor before choosing how to receive proceeds.