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A reverse mortgage allows you to get cash out of your house without having to sell and move or make monthly payments as you continue to live in your home.
A “reverse” mortgage is simply the reverse of a regular or “forward” mortgage. In a forward mortgage, we use our income (from a job, for example), combined with a debt instrument to create equity in a home. In the reverse mortgage, equity that is built up in the home is used to create an income.
The most common reverse mortgage is the “Home Equity Conversion Mortgage” or HECM and is currently the only reverse mortgage insured by the U. S. Government (Federal Housing Administration).
It is important to understand that a reverse mortgage is a LOAN against your home and, as such, it MUST be paid back. Here are some key points:
- You DO NOT have to pay back the loan for as long as you live in your home.
- You DO NOT have to make any monthly payments for as long as you live in your home.
- All homeowners MUST be age 62 or above;
- The home MUST be the principal place of residence.
How much you can you borrow depends on your age (loan amounts are based on the youngest applicant’s age); the appraised value of the home; and, current interest rates. However, there are limits as to how much you can borrow and this amount is set regionally by the FHA.
Paying Back a HECM Loan
Remember, this is a LOAN and must be paid back. However, there are NO payments due while you live in the home. Additionally, due to the insurance aspect of the loan, you or your heirs will never owe more than the value of the home – regardless of how much is owed on the loan.
HECM Counseling
All potential borrowers MUST have consumer information counseling. This session can be done either face-to-face or by phone and may seem cumbersome but it has been put in place to protect you – the consumer.
You would be well advised to research both the pros and the cons of a reverse mortgage. They have helped many seniors financially but there are strings attached. Spend time on the government’s website and then discuss your situation with a HECM counselor.
What else can I help you with?
Do you still have to pay monthly mortgage if you have a reverse mortgage?
No, the purpose of a reverse mortgage mortgage is to eliminate mortgage payments permanently.
What is a reverse mortgage lead?
A reverse mortgage lead is where you can get names of people that are interested in getting a reverse mortgage. These leads should already have been screened to meet the criteria for a reverse mortgage.
What are the reverse mortgage scams taking place today?
Yes, there are reverse mortgage scams, as well as regular mortgage scams. You need to be careful who does your reverse mortgage, so you do not get scammed
Reverse Mortgage Calculator?
Reverse Mortgage Calculator Use this calculator to help determine the balance of a reverse mortgage. This calculator is specifically designed to show you how the outstanding balance of a reverse mortgage can rapidly grow over a period of time.
Where can you find a reverse mortgage calculator?
Reverse mortgage calculators can be found on line on most mortgage websites.There are hundreds of mortgage loan sites.& This calculator makes it easier to understand the reverse mortgage math and to let you see if this type of mortgage is best for you.
What is American reverse mortgage?
American reverse mortgage is when you borrow money based on the value of your house. A reverse mortgage has the option of being a lump sum or installments.
Where can I learn about liberty reverse mortgage?
You can learn about liberty reverse mortgage from any local tax consultant or by finding it on a website which deals specifically with liberty reverse mortgage.
Can you re-finance your reverse mortgage?
yes, you can refinance it to a regular mortgage, or if interest rates are lower you can streamline it to a new reverse mortgage.
Can you get a reverse mortgage if you file bankruptcy?
Yes, a reverse mortgage does not have any credit requirements, however if you are in bankruptcy or filing one you may need court approval to do the reverse mortgage.
What do you do with marketing and reverse mortgage?
There isn't any marketing that you need to do for an reverse mortgage. All you have to do is visit a local realator and you can also go online and search under reverse mortgage.
Where can one get reverse mortgage quotes?
There are many places where one can get reverse mortgage quotes. One can get reverse mortgage quotes at popular on the web sources such as ARRP and Bank Rate.
Where can I find a reverse mortgage guide?
If you want a reverse mortgage guide, your most reliable guide is a trained reverse mortgage professional. Try contacting an established local firm for guidance.
