Reverse Mortgage – FHA’s Home Equity Conversion Mortgage (HECM)

A FHA HECM reverse mortgage loan is a very special type of loan that permits borrowers to convert some of the equity in their home to cash.  Reverse  mortgages can give senior homeowners the funds they  need to lead a more secure and enjoyable retirement,  repair their homes, or potentially pay for long-term care  and other necessary expenses, while allowing them to  continue to live in their own homes for as long as they want.

Borrower Requirements

You must:

●      Be 62 years of age or older

●      Own the property outright or have a relatively small mortgage balance

●      Occupy the property as your principal residence

●      Not be delinquent on any federal debt

●      Participate in a consumer information session given by an approved HECM counselor

●      Be buying a home using a reverse mortgage with a very large down payment

Mortgage Amount Based On

●      Age of the youngest borrower

●      Current interest rate

●      Lesser of appraised value or the HECM FHA mortgage limit or the sales price

●      Initial Mortgage Insurance Premium (MIP)–your choices are HECM Standard or HECM SAVER initial MIP

Financial Requirements

●      No income or employment qualifications are required of the borrower

●      No repayment as long as the property is your principal residence and the obligations of the mortgage are met

●      Closing costs may be financed in the mortgage

Property Requirements

The following eligible property types must meet all FHA property standards and flood requirements:

●      Single family home or 1-4 unit home with one unit occupied by the borrower

●      HUD-approved condominium

●      Manufactured home that meets FHA requirements

Reverse Mortgages have been the solution for some of iLoan’s most satisfied customers but a reverse mortgage is not the best solution for every senior.   It can be an excellent choice for many seniors who evaluate their options carefully. We encourage you to take the time to gather all the facts and discuss your plans and specific needs with your family and financial, legal, and tax advisors. If you decide to proceed with a reverse mortgage transaction, you will be required to attend counseling from an independent HUD-approved counseling agency. Any questions or concerns you have regarding a reverse mortgage (or how you plan to use the proceeds from a reverse mortgage) should be  addressed during that session.