Reverse Mortgage
- A reverse mortgage is a loan that allows homeowners who are 62 or older to borrow against a portion of the equity in their home. A reverse mortgage works differently than a traditional mortgage loan because instead of making payments to your lender, your lender will make a payment to you. The loan first pays off your existing mortgage, if you have one, and then you can use the remaining funds for anything you’d like. You must continue to pay your property taxes and homeowners insurance, and you’re responsible for maintaining the home. To qualify for a reverse mortgage:
- You must be at least 62 years of age.
- You can only get a reverse mortgage on your primary residence, not a second residence or vacation home.
- To take out a home equity conversion mortgage (HECM), the U.S. Department of Housing and Urban Development (HUD) requires that you attend a reverse mortgage counseling session. You’ll also be required to undergo a financial assessment to ensure you can meet the financial obligations of the loan.
- You can’t owe federal debt, such as student loans or income tax.
- The real estate must meet required property standards.
This loan is a bit complicated and can come with some drawbacks so it’s important to know how it works, how it can help you and whether it’s the right option for your financial situation and retirement goals.
If you’d like to explore the details of a reverse mortgage, call your licensed Approved Mortgage Solutions mortgage broker at the phone number below or Contact Us and we’ll reach out to you.