Reverse Mortgages

Frequently Asked Questions (FAQ)

  1. WHAT IS A REVERSE MORTGAGE?

    A Reverse Mortgage is a loan that enables senior homeowners, age 62 and older, to eliminate all future monthly mortgage payments and convert part of their home equity into tax-free* income without selling the home.

  2. WHAT ARE THE BIGGEST BENEFITS OF A REVERSE MORTGAGE?

    Payments relief (no monthly mortgage payments). Government insured (by HUD / FHA). Maintain ownership (your heirs can inherit your home). Financial Assistance (use the cash from the equity of your home to use however you like).

  3. DOES IT MATTER IF I HAVE A MORTGAGE OR OWN MY HOME FREE AND CLEAR?

    It doesnít matter. Those who own their home free and clear will have access to more cash.

  4. IíVE HEARD REVERSE MORTGAGES GIVES OWNERSHIP OF MY HOME TO THE BANK. IS THIS TRUE?

    No. You maintain ownership just as you would with a traditional mortgage. You can sell your home at anytime or leave it for your heirs who can sell the home or refinance it in their names.

  5. WHAT ARE THE COSTS AND FEES?

    There are typically no out-of-pocket costs. One of the real benefits of a Reverse Mortgage is that you can use the money you get from your home's equity to pay for the various fees that are part of the loan costs overall.

  6. WHAT ARE THE TAX CONSEQUENCES OF A REVERSE MORTGAGE? WHAT ABOUT MY SOCIAL SECURITY AND MEDICARE BENEFITS?

    Because Reverse Mortgages are considered loan advances and not income, the IRS considers them not taxable. Similarly, having a Reverse Mortgage should not affect your Social Security or Medicare benefits. Please consult a tax advisor.

    May effect medicaid & SSI eligibility.

  7. WHAT ADVICE SHOULD I GET BEFORE TAKING A REVERSE MORTGAGE?

    The Federal Government (HUD) requires you to take a 45-minute counseling session. This is provided by an independent, government-approved, housing counseling agency. The counselor will explain the pro's and con's of a Reverse Mortgage: costs and financial implications, and other government or nonprofit programs for which you may qualify.

    This is mandated for your protection.

  8. IF I TAKE A REVERSE MORTGAGE, WILL I STILL HAVE AN ESTATE THAT I CAN LEAVE TO MY HEIRS?

    When you sell your home or no longer use it for your primary residence, you or your estate must repay the lender for the cash received from the Reverse Mortgage, plus interest and service fees- often paid with the remaining equity. Any remaining equity belongs to you or your heirs. We ensure that you can never owe more than the home's appraised value when it is sold. None of your other assets will be affected by your Reverse Mortgage loan.

  9. WHEN MUST A REVERSE MORTGAGE LOAN BE REPAID?

    Your Reverse Mortgage loan becomes due and must be paid in full when one or more of the following conditions occurs: (a) the last surviving borrower passes away or sells the home; (b) all borrowers permanently move out of the home; (c) the last surviving borrower fails to live in the home for 12 consecutive months due to physical or mental illness; (d) you fail to pay property taxes or insurance; (e) you let the property deteriorate beyond what is considered reasonable wear and tear, and do not correct the problems.

  10. HOW DO I KNOW IF I QUALIFY? HOW CAN I FIND OUT HOW MUCH CASH I CAN RECEIVE?

    Call your local Reverse Mortgage Specialist 1-877-6REVERSE (877-673-8377) for answers to all your questions. We also have free videos and educational materials.

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