WHAT IS A REVERSE MORTGAGE?

A Reverse Mortgage is a type of loan that provides homeowners age 62 and older with the option to turn their home equity into cash to pay off debt, increase monthly cash flow and provide financial stability while still living in and owning their own home. Reverse Mortgages that conform to FHA guidelines are also called HECM loans - Home Equity Conversion Mortgages.

If you need a large sum of cash for a big expense, or just a little more money each month a reverse mortgage may be your answer. With a Reverse Mortgage, you have the flexibility to choose how you want to be paid. You can choose between a lump payment, a monthly payment, or even a line of credit.

No repayment is required until the home is sold or the owner permanently moves out or passes away!

REVERSE MORTGAGE BORROWER ELIGIBILITY

In order to be eligible for a reverse mortgage, there are a few requirements:

  • You must be a minimum of 62 years old.
  • No credit score requirements with minimal income
  • You must live in the home

WHY A REVERSE MORTGAGE?

  • Continue to live in your home
  • Option to re-pay the loan with no penalty
  • Make NO payments for as long as you live in your home**
  • Non-recourse loan which means the borrower can NEVER owe more on the loan than what the house is worth

 

* Please consult your financial advisor
** Homeowners must continue to pay insurance, taxes and basic home maintenance during loan period

FHA insures fixed interest rate mortgages, as well as annual and monthly adjustable interest rate mortgages; the mortgagor has the ability to change the method of payment under the HECM at any time provided funds are available; fixed interest rate mortgages are limited to the Single Disbursement Lump Sum payment option where there is a single, full draw at loan closing and the mortgage does not provide for future draws by the mortgagor under any circumstances; adjustable interest rate mortgages provides for five, flexible payment options, and allows for future draws; the amount of funds available to the mortgagor is currently determined by the age of the youngest mortgagor, and the disbursement of mortgage proceeds during the first twelve-month disbursement period is subject to an initial disbursement limit as determined by requirements set by the Secretary.