A Reverse Mortgage is a home equity loan available to home owners of retirement age which allows them to access a portion of their home's equity. There are no payments with a reverse mortgage. The accrued balance only becomes due when the home owner(s) dies, sells the house, fails to keep the taxes or insurance current, or moves out of the house for more than 12 consecutive months. Home owners may choose to receive cash in several ways:
- One Lump Sum
- Monthly Payments over a period of time
- Revolving Line of Credit
- Any combination of the above
To qualify for a reverse mortgage in the United States, the borrower must be at least 62 years of age and must occupy the property as their principal residence. In addition, any mortgage on the property must be low enough that it will be paid off with the reverse mortgage proceeds. The proceeds from the loan may be used at the discretion of the borrower and are not subject to income tax payment. Reverse mortgages follow FHA standards for property types, meaning most 1–2 family dwellings, FHA approved condominiums and PUD's will qualify. Manufactured housing qualifies based on standard FHA guidelines. Before starting the loan process for an FHA/HUD reverse mortgage, applicants must take an approved counseling course with an independent counselor from a HUD approved agency. This counseling is available at no or low cost. The counseling is meant to serve as a safeguard for the borrowers, to ensure they completely understand the reverse mortgage. The counselor will explain the legal and financial obligations of a reverse mortgage. The borrower will receive a certificate of completion that is required before the loan application can be processed.
Please watch the included video to see if a Reverse Mortgage is right for you!
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Reverse Mortgages today!
803-808-6230
**These materials are not from HUD or FHA and were not approved by HUD or a government agency.**