Reverse Mortgage Loans
If you’re 62 and older, you can use a reverse mortgage loan to purchase a new home, or turn your current home’s equity into cash. A reverse mortgage loan gives retirees the
opportunity to potentially increase their purchase power or cash flow while eliminating monthly mortgage payments. You are still required to pay property taxes, homeowners
insurance, and maintain the home. Here are just a few reasons why you should consider a reverse mortgage.
A reverse mortgage loan is a way to turn a portion of the equity in your home into cash. The proceeds from a reverse mortgage can be used to pay for unexpected expenses, such as nursing home costs or long term care. It could also provide you with additional cash flow for all the expenses you have, or allow you to purchase a new home with a lower down payment compared to using your cash to pay in full.
The deed is still in your name so you can move whenever you want. Most reverse mortgages are federally insured through the FHA. As long as you pay your property taxes, homeowner’s insurance, and maintenance costs your home cannot be foreclosed on. They will honor this commitment for life, or as long as you live in your home. However, you are allowed to change your mind and sell the home whenever you want if you wish to move to warmer climates, a smaller home, closer to your children, or whatever your choice may be.
One-to-four unit properties, PUDs, Townhouses, and FHA approved condos; all qualify for a reverse mortgage as long as they meet all of FHA safety guidelines. You can even purchase a double-wide manufactured home built after June 15, 1976 that is permanently affixed to a foundation on land you own. For a Home Equity Conversion Mortgage (HECM) reverse mortgage the maximum allowed home value is $970,800 for 2022, but if your home is worth more it could qualify for a jumbo loan product that is not backed by the FHA. If you would like more information about this type of (non-HECM) reverse mortgage loan, please contact us for more information.