A reverse mortgage is a special type of loan which enables homeowners age 62 years and above to convert part of the equity in their home into tax-free cash without having to sell the home, give up title, or take on a new monthly mortgage payment. A reverse mortgage will not affect Social Security or Medicare, and there are no health qualifications. Although no monthly mortgage payments are required, you are free to make mortgage payments at any time throughout the year.
Did you know? You can purchase a home with a reverse mortgage! There are no monthly mortgage payments required! Snowbirds welcome! You can move south, west, or buy a home closer to your family!
The federally-insured FHA reverse mortgage or HECM, Home Equity Conversion Mortgage, is regulated by the Department of Housing and Urban Development (HUD) and is insured by the Federal Housing Administration (FHA). Here are the qualifications:
* Be at least 62 years of age at time of closing and own your own home
* Reside in a your home as your primary residence
* 1-4 unit properties acceptable (you must live in one of the units), FHA-approved condos, PUDs, manufactured homes, some mixed-use properties (borrower must reside in one of the multi-family units as primary)
* Reverse mortgage counseling is required by a HUD-approved counselor
* You cannot be delinquent on any federal debt
Reverse Mortgages Have Changed
Over the past fifty years or so, ever since the very first FHA-insured reverse mortgage closed in 1988, reverse mortgages have been enhanced to provide all the safeguards you'd want in a mortgage.
*capped Interest rates * reverse mortgage counseling *FHA mortgage insurance (protects lender & borrower)
*limitation on out-of-pocket fees *no maturity date *no prepayment penalty *asset protection
*** Announcing! Reverse mortgages are now approved for co-ops (COOPERATIVES) in New York State. These are proprietary reverse mortgages, not FHA, and must be approved by the co-op board and the reverse mortgage lender. Only single units need approval by the lender; the entire co-op will not need lender approval.