Reverse mortgages are unique types of home loans available to homeowners 62 years of age and older. With a reverse mortgage, you are able to convert a portion of your home equity into cash. Reverse mortgages were created to help retirees with low incomes use a portion of the money accumulated in their homes to cover their living expenses. Typically, a homeowner makes monthly payments to a lender. However, with a reverse mortgage, it is the opposite, and the lender makes payments to the borrower.
Unlike typical home equity loans, you will not have to pay back the loan until you no longer use the home as your principal residence, or fail to meet the requirements and payments of the mortgage. In other words, you will not have to pay back the loan until the home is sold or vacated. And as long as you live in the home, monthly payments towards the balance of the loan is not required.
In most cases, reverse mortgages are issued as Home Equity Conversion Mortgages, also known as HECMs. These mortgages are insured by the Federal Housing Administration, also known as the FHA. As a result, you will want to select an FHA-approved lender when getting a reverse mortgage. Non-HECM reverse-mortgage lenders are another option, but they do not have the same consumer protection as HECMs, increasing the risk.
To get a reverse mortgage, you must meet the following qualifications:
Before being approved, your lender will perform a financial assessment, which includes looking at your payment history, outstanding mortgage loans, credit, and income statements. By doing this, your lender will be able to determine your financial stability (including your 401(k), pension, social security, and pay stubs), as well as your ability to afford ongoing housing costs. Additionally, your lender will conduct a property appraisal, determining the value of your home, and how much you will be able to borrow in a reverse mortgage.
Retirees over the age of 62 typically get reverse mortgages, to help with the cost of living after retirement. By using a reverse mortgage, retirees are able to turn their homes into a source of revenue, providing much needed finances to supplement other income streams.
Strock and Trainer Mortgage Corporation specializes in helping seniors ages 62 and older get reverse mortgages in the Florida region. If you live in one of the following cities, we can help you get one step closer to financial security, so you can spend more time with the people you care about, doing the things you love.
We have helped residents from Miami, Fort Lauderdale, Fort Myers, Orlando, Tampa, Jacksonville, and Tallahassee set up their reverse mortgage loans, and we can help you too.