- Type of Loan: The FHA Reverse Mortgage ( HECM) is considered a Government Loan insured by HUD. This loan designed to help seniors stay in their home with no monthly mortgage payments.
- Loan Term: The loan term expires after the death of the last surviving spouse.
- Mortgage Insurance: FHA requires MIP ( Mortgage Insurance Premium) both up front and monthly regardless of your down payment or loan to value.
- Credit Score Requirements: There are no minimum credit score requirements on a HECM / reverse mortgage.
- Down Payment Requirements: On a purchase, the borrower provides a down payment using the sale of the previous home or other savings. The equity earned through the down payment and the new home’s value is then used to calculate the reverse mortgage loan amount.
- Interest Rate: Fixed/ Adjustable
- Additional Facts: To qualify for a Reverse Mortgage a borrower must: Be at least 62 years of age and must have the financial ability to pay the property taxes and homeowners insurance on your home. In addition, you must occupy the property as your primary residence and have an average 30% – 50% equity in your property. You may not be delinquent on a federal debt to qualify for a Reverse Mortgage. There are no income requirements other than having enough to pay the taxes and insurance on the property. Offers flexible cash out options to the borrower by getting money from a line of credit, lump sum or in monthly installments. A reverse mortgage is not the right loan for all borrowers, so you should seek our expert advice before deciding to move forward with this loan. Talk to one of our Licensed Loan Originators to review with you all of the possible risks and advantages. For a more in depth review of reverse mortgage loans go to www.HUD.gov.