Improve Retirement with NO Monthly Mortgage Payments*
If you are a 55+** homeowner, a reverse mortgage may be able to free up your monthly cash flow. Get access to your home equity and stay in the house you love* or use those funds to purchase a new one.
- ✓ Use proceeds to pay off existing forward mortgage
- ✓ Make home renovations, payoff other debt †, fund in-home care, or travel the world
- ✓ Get tax-free †† proceeds with no monthly mortgage payments required*
- ✓ Rest easy knowing your heirs are never personally responsible for the loan
- ✓ Provide a living inheritance and help pay for children’s homes or grandkid’s college tuition.
HOW IT WORKS
A Reverse mortgage converts your home equity into usable cash,
similar to a home equity line of credit (HELOC). The unique benefit
of a reverse is that you don’t need to pay back the loan month after
month. Instead you pay it all back at the end.
You don't make monthly
You still pay your property taxes, insurance,
and other property charges, as well as
maintain the home.
You live in the house as your
primary residence for as long as
you like/are able to.
Meanwhile, the balance of the loan is
accruing with interest. The balance of the
loan accrues interest, which can be slowed
by making optional payments.
A financial agreement in which a homeowner relinquishes equity in their home in exchange for regular payments, typically to supplement retirement income.
Speaking with an experienced loan officer is the best way to get the concrete numbers that reflect your individual situation. The amount you may qualify for is highly dependent on several variables, including:
- ✓ Your age
- ✓ The state you live in
- ✓ Current interest rates
- ✓ Your home’s value
- ✓ The reverse product and disbursement option you choose
For most products, you have the ability to access your home equity in the way that makes the most sense for your financial needs. Options include receiving a lump sum upfront, setting up monthly disbursements, establishing a line of credit – or a combination of all three.
Typically, a reverse mortgage ends when you no longer use the home as your primary residence. This could be due to several factors, including a permanent move, selling the home or the last borrower passing away. At this time, the balance must be repaid.
It’s important to remember that reverse mortgages are non-recourse loans, which means that you, or your estate can’t owe more than the value of your home when the loan becomes due and the home is sold.
Closing costs for a reverse mortgage are near-identical to what yo would expect to pay when obtaining a traditional forward mortgage. Most of the sots can be financed into the loan, so there is a minimal out-of-pocket upfront cost. Here’s what you can typically expect to see:
Similar to what you’d expect with a forward mortgage:
- ✓ Appraisal (usually paid in advance)
- ✓ Title services and title insurance
- ✓ Credit report
- ✓ Property inspection (not always required)
- ✓ Origination fee (if applicable)
- ✓ State and local taxes, and tax verification fee
- ✓ Government recording fees
Unique to a reverse mortgage:
- ✓ Reverse counseling (paid in advance)
- ✓ FHA insurance (only for HECM loans)
*The borrower must meet all loan obligations, including living in the property as the principal residence and paying property charges, including property taxes, fees, hazard insurance. The borrower must maintain the home. If the homeowner does not meet these loan obligations, then the loan will need to be repaid.
**For Certain Home Safe® products only, excluding Massachusetts, New York, and Washington, where the minimum age is 60, and North Carolina, Texas and Utah where the minimum age is 62. The HomeSafe® reverse mortgage is a proprietary product of Finance of America Reverse LLC and is not affiliated with the home Equity Conversion Mortgage (HECM) program. Not all HomeSafe® products are available in every state. contact us for a complete list of availability
† If you are thinking about debt consolidation, you might want to first consult a non-profit credit. Please contact us for a complete list of availability.
†† Not tax advice. Consult a tax professional.
This is not a commitment to lend. Prices, guidelines and minimum requirements are subject to change without notice. Some products may not be available in all states.
Subject to review of credit and/or collateral; not all applicants will qualify for financing. It is important to make an informed decision when selecting and using a loan product; make sure to compare loan types when making a financing decision.
These materials are not for HUD or FHA and were not approved by HUD or a government agency.
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