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A reverse mortgage is a loan that enables homeowners who are at least 62 years old to convert some of their home equity into cash, a line of credit, or to finance a home purchase with the freedom of no monthly mortgage payments. The borrowers continue to live in and own their home.
Unlike a traditional home equity loan or home equity line of credit, a reverse mortgage doesn't have to be repaid until the last surviving borrower does not meet loan obligations such as taxes and insurance, and maintaining the condition of the hom, then the loan will need to be repaid. |
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Will the Bank Own My House?
No. Just like a traditional mortgage, as long as the terms of the loan are met, the borrowers retain full homeownership and can sell the home at any time. |
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How Much Money Can I Get?
This is determined by the age of the youngest borrower, your home value, the amount of equity, FHA lending limits, the current interest rate, and he reverse mortgage product and payment option you choose. A Reverse Mortgage Specialist from FAM can provide you with a quote that's tailored to your specific situation, with no cost or obligation. |
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How Do I Receive My Proceeds?
You can take your funds as a lump sum; monthly payments for a specified time period, or for as long as you live in the home; a line of credit; or a combination of these. |
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Am I Spending My Children's Inheritance?
A reverse mortgage may help you plan for a more comfortable retirement, lived with greater financial independence. At FAM, we encourage you to involve family members in your decision process-so you can make the choice that's right for you. When the home is sold or no longer estate, and can be transferred to heirs. |
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What are the Costs Associated With a Reverse Mortgage?
In addition to interest, the costs can include a property appraisal fee, origination fee, closing costs, mortgage insurance premium, servicing fee and a modest charge for HECM counseling. While closing costs vary based upon the type and size of the loan, they're the same as those for any traditional mortgage. You can roll most of the upfront costs into the loan, so out-of-pocket expense can be minimized. A FAM Reverse Mortgage Specialist will be pleased to give you a detailed cost breakdown. |
This information is provided by Finance of America Mortgage. Any materials were not provided by HUD or FHA. It has not been approved by FHA or any Government Agency. *Consult a tax advisor. Information subject to change without notice. This is not a commitment to lend. Prices and guidelines 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 in informed decision when selecting and using a loan product; make sure to compare loan types when making a financing decision. Reverse mortgage borrowers are required to obtain an eligibility certificate by receiving counseling sessions with a HUD-approved agency. Family members are also strongly encouraged to participate in these informative sessions. Must be 62 years old. Loan proceeds are not considered income and will not affect Social Security or Medicare benefits. Your monthly reverse mortgage advances may affect your eligibility for some other programs. Consult a local program office of your attorney to determine how, or if, monthly reverse mortgage payments might affect your specific situation. When the loan is due and payable, some or all of the equity in the property that is the subject of the reverse mortgage no longer belongs to borrowers, who may need to sell the home or otherwise repay the loan with interest from other proceeds. The lender may charge an origination fee, mortgage insurance premium, closing costs and servicing fees (added to the balance of the loan). The balance of the loan grows over time and the lender charges interest on the balance. Borrowers are responsible for paying property taxes, homeowner’s insurance, maintenance, and related taxes (which may be substantial). We do not establish an escrow account for disbursements of these payments. A set-aside account can be set up to pay taxes and insurance and may be required in some cases. Borrowers must occupy home as their primary residence and pay for ongoing maintenance; otherwise the loan becomes due and payable. The loan also becomes due and payable (and the property may be subject to a tax lien, other encumbrance, or foreclosure) when the last borrower, or eligible non-borrowing surviving spouse, dies, sells the home, permanently moves out, defaults on taxes, insurance payments, or maintenance, or does not otherwise comply with the loan terms. Interest is not tax-deductible until the loan is partially or fully repaid.
It is important to make in informed decision when selecting and using a loan product; make sure to compare loan types when making a financing decision. Reverse mortgage borrowers are required to obtain an eligibility certificate by receiving counseling sessions with a HUD-approved agency. Family members are also strongly encouraged to participate in these informative sessions. Must be 62 years old. Loan proceeds are not considered income and will not affect Social Security or Medicare benefits. Your monthly reverse mortgage advances may affect your eligibility for some other programs. Consult a local program office of your attorney to determine how, or if, monthly reverse mortgage payments might affect your specific situation. When the loan is due and payable, some or all of the equity in the property that is the subject of the reverse mortgage no longer belongs to borrowers, who may need to sell the home or otherwise repay the loan with interest from other proceeds. The lender may charge an origination fee, mortgage insurance premium, closing costs and servicing fees (added to the balance of the loan). The balance of the loan grows over time and the lender charges interest on the balance. Borrowers are responsible for paying property taxes, homeowner’s insurance, maintenance, and related taxes (which may be substantial). We do not establish an escrow account for disbursements of these payments. A set-aside account can be set up to pay taxes and insurance and may be required in some cases. Borrowers must occupy home as their primary residence and pay for ongoing maintenance; otherwise the loan becomes due and payable. The loan also becomes due and payable (and the property may be subject to a tax lien, other encumbrance, or foreclosure) when the last borrower, or eligible non-borrowing surviving spouse, dies, sells the home, permanently moves out, defaults on taxes, insurance payments, or maintenance, or does not otherwise comply with the loan terms. Interest is not tax-deductible until the loan is partially or fully repaid.
