The Essential Reverse Mortgage Factsheet

The Essential Reverse Mortgage Factsheet A Reverse Mortgage is not for everyone, but it might be worth considering if.. How they work... So you decide to get a Reverse Mortgage, You are committed to staying in your home, either because you 1 don't want to leave or because other housing alternatives are unappealing or unaffordable. 2 You want to enhance your lifestyle and enjoy your golden years. The amount you can receive is based on several factors. You want a cushion for major expenses such as medical bills for a serious or long-term condition, or for major home repairs You have a regular need for additional income to live on and your only significant asset is your home Your age: +The older you are, the more money is available. You want the peace-of-mind that comes from knowing your 5 financial needs are taken care of. The higher the appraised value, the more money is available. However, there is a cap you can borrow against of $625,500. Home value: Do I qualify? The current interest rate is also factored in. Are you at least 62 years old? Yes No The final factor is how you receive your payment. Do you own your property outright? Line of credit. A combination of these three. Fixed monthly payments for as long as you live in your home. Lump sum payment. Yes No Is your mortgage small enough to be paid off easily from the proceeds of the reverse mortgage? You do not have to make a single payment on the mortgage until you are no longer living in the home. Yes No Do you occupy the property as your primary residence? Pay off the loan and keep the home. When that time comes and the Reverse Mortgage is due, the borrower or their heirs can either... Yes No Sell the home and Are you delinquent on any federal debt? pay off the loan. No Yes Is your property a single family home, 1-4 unit home, HUĎ approved condominium, or manufactured home that meets FHA requirements? How much will this cost? There are several costs associated with Reverse Mortgages. Most of them are similar to their regular mortgage counterpart. Yes No You do not qualify. Congratulations! You qualify for an HECM Reverse Mortgage. This is to compensate the lender for processing the loan. It can be up to $2,500 if your home is valued less than $250,000 or up to 2% of its value if it's over that amount. The fee is capped at $6,000 no matter the value of your home. Origination fee This insurance guarantees that you will receive expected loan advances and that you will not have to repay the loan for as long as you live in your home. It will cost 2% of the value of your home and a monthly premium of .5% of the loan balance. Mortgage insurance Before you can get an HECM Reverse Mortgage you are STOP required to meet with an HECM counselor to discus your options, eligibility, and requirements. To find an HECM counselor near you, call (800) 569-4287. premium Tip: A face-to-face meeting is strongly encouraged over telephone counseling to make sure you make an informed and independant decision. There are a wide range of costs from third parties that are associated with closing a loan. These can include appraisal fee, title search and insurance, surveys, inspections, recording fees, mortgages taxes, credit checks and other fees. They can add up to several thousand dollars. Closing costs Potential Advantages... A Reverse Mortgage can help you maintain your financial independence or improve your quality of life. This monthly fee is for lenders and their agents who service the loan on an ongoing basis. This can include monthly statements, disburing loan proceeds, and making sure all requirements are met. This fee can be no more than $35 per month. Servicing fee It will allow you to remain in your home and keep title to your property The money you receive is tax-free. It is not usually consid- 3 ered income. All HECM loans charge interest. You can choose adjustable or fixed rate. Lenders cannot adjust interest rates by more than 2 percentage points per year or 5 points over the life of the loan. Interest rate You make no payments (principal or interest) until the loan ends or the house is due. Your income is not a consideration in obtaining the loan since there are no payments until the loan ends. You cannot owe more than the value of the house at the end 6 of the loan. Like all mortgages, the fees can be costly and add up. The good news is that almost all of these costs can be paid for with the proceeds of the Reverse Mortgage itself. What seniors need to be aware of... Your home may be more important to your heirs than yourself. Be sure to talk with your family about such important decisions. The Federal regulations regarding mortgages are constantly 2 changing. Be sure you have recently talked to a HECM counselor. Reverse Mortgages are a new product to many sales agents. 3 Make sure you work with an Reverse Mortgage specialist. REVERSE MORTGAGENET mint.com WALLSTATS.c. S.com THE ART OF INFORMATION