For senior homeowners who are in need of a loan and want to tap their home equity, reverse mortgages are an ideal option to get the cash they need. There are several different types of reverse mortgages available that can help pay off a current mortgage or supplement retirement. The loan is currently insured by the Federal Housing Administration and already includes upfront costs and fees that are usually more than 10 percent.

The basic requirements to qualify for the mortgage include being over the age of 62, with the home being used as the primary place of residence. The property must be a single family home or 2-4 unit home. It can also be a manufactured home or an HUD-approved condominium project.

A significant portion of the home must already be paid off or paid in full before applying and the property needs to be in good condition or be repaired before approval. Discharged bankruptcy and the health of the homeowners do not influence approval for the loan and all real estate taxes need to have been paid on time by the applicant. The Federal Housing Administration also requires that the applicant meet with an HECM counselor to evaluate how the process works.

The process of the mortgage is the opposite of traditional home loans. With this type of mortgage, you’re paid a monthly amount instead of paying the loan off each month. The loan is automatically repaid once you sell your home or become deceased. All proceeds are tax-free without any income restrictions, making it an ideal option for many homeowners.

This type of mortgage should be considered for seniors who need to supplement their retirement income or even finance a home improvement that is needed. The loan can also benefit anyone who wants to pay off their current mortgage and plans to live on the property long-term.

Call us today to see if a reverse mortgage is right for you! (805) 229-6800