A Reverse Mortgage is a national program which typically is offered to homeowners 62 years and older but some private programs have recently been opened to borrowers down to 59 1/2 years old which allows the homeowner access to their equity in the form of cash, monthly income to the homeowner, or a combination of both with the homeowner never making another loan payment for life. The money the homeowner receives is usually tax-free and does not affect Social Security benefits or Medicare (check with your financial advisor for your circumstances). There are very minimal credit requirements and no income requirements to qualify, borrowers can even be in foreclosure and still obtain a reverse mortgage.

No, you retain the same ownership and title that you have today. The lender puts a lien on the property just as they would with a regular forward mortgage which is paid off when you sell your property, or when you pass and your heirs inherit and they can pay off the loan with another loan or other funds.

When you sell the property or no longer occupy your home as your primary residence for a period of 12 months or longer.

You must maintain the property in reasonably good condition.  You must pay the property taxes and the homeowners insurance and any homeowner's association dues you may have.  And of course, the lender expects you to continue to occupy the property.

Yes you can but the lender and title company do require that they review the trust and it must be approved. If you hold title in a trust you should let your Loan Officer know up front so he/she can get a copy of the trust and have it reviewed immediately so that there are no surprises later. Most trusts are prepared with lenders and their requirements in mind so they are not a problem but it is best to know as early on as possible!

You do not need to own your home free and clear to get a reverse mortgage. The proceeds can be used for any purpose, but any existing liens on the property must be paid off at closing. If the reverse mortgage is not large enough to cover your existing loan, you can still get the reverse mortgage by bringing in the additional funds from another account and still never have to make another house payment!

Yes, after the balance of your reverse mortgage is paid off, all remaining equity will go to your heirs. One of the forms we provide you with before you close your loan is an amortization schedule so you will always know the principal balance of your loan, year by year. How much equity will remain will Depend on such variables as how much money you draw, how long you stay in your home, home appreciation your home experiences and interest rates (if you have a variable interest rate loan).

This is one of the important safeguards of the reverse mortgage loan.  The loan is known as a "no-recourse loan" which means that you and your heirs can never owe more than the property is worth, regardless of how long you occupy your home, how much money you borrow, or what happens to property values.  The lender's only security for the loan is the property and you and your heirs can never owe more than the property is worth, regardless of the circumstances.

While the reverse mortgage allows you to age in place and has no recourse, you are spending what has typically become a portion of the inheritance people have historically left to their heirs.  With the changing of people's life expectancies, people no longer work until they are 62 and then pass at 70 leaving an estate with a paid off mortgage for their heirs.  Now, people are living longer and need an additional source of income to help fund their retirement as social security is not equipped to fulfill all their needs.  The reverse mortgage is an excellent and viable retirement tool but many seniors find it better to talk to their families early on in the decision making process.  Most family members are not equipped to fund their family needs as well as those of their parents and see reverse mortgages as welcome vehicles for their senior family members, however, communication is highly recommended.

Bankruptcies are typically not a problem and there is no time limit after a bankruptcy has been discharged.  However, if you are currently in a Chapter 13 Bankruptcy (where you're making payments), then you have to be able to show that you have been making payments on time for a period of 12 months or more.  The credit requirements are that you are not currently delinquent on a federal debt (SBA Loan, Student loan, FHA home loan, etc).

The reverse mortgage, especially the HUD Home Equity Conversion Mortgage (HECM) can be a very expensive short-term loan and may not be right for all borrowers. There are many things to consider. With the costs of the loan and the government insurance, if you only need the loan for a very short period of time, a reverse mortgage may not be the right option for you. On the other hand, if you intend to occupy your property for a long period of time and wish to never make another payment for life while accessing your equity in the form of monthly payments, a line of credit, or both, then a reverse mortgage may be perfect for you!

Rates vary by program.  For example, just within the HUD HECM loans you have fixed rates, monthly adjustable rates, and annual adjustable rates, with the adjustable rates, you have different margins available depending on the secondary market conditions at the time you obtain your loan.  The one thing that you do need to remember is that all HUD rates are regulated in the same manner, that is, the index that drives the rate is the same for all lenders.  The margin that they add to the index is what can vary, and this can be driven by the mortgage market.  The rates for proprietary programs vary with the programs.  We have access to many lenders’ products, not just one or two, so we can be sure to match you up with the program which best suits your needs. 

Quite a bit of this depends on you! The specialists at All Reverse Mortgage Company have many years experience in the mortgage banking industry and have become industry leaders in reverse mortgage loans. We can take you through the process as fast or faster than any other lender but we need your help to get your counseling certificate completed as soon as possible (HUD does not allow us to complete many steps of the process until this very important step has been performed), we need to collect a very few things from you, but we do need to get them and the sooner the better, and we need your help to get the disclosures signed and returned in a timely manner. We can and do close most transactions in less than 30 days but we need your cooperation to do so!

A Reverse Mortgage Counseling Certificate is the certificate that you receive once you have attended a counseling session conducted by a certified reverse mortgage counselor. The counseling is specific to the program you have selected (whether it be the Government HECM program or one of the private proprietary products available) and can be done either face to face or by phone. We will be happy to give you the name and number for counselors who can offer the counseling for your desired product and we will be happy to assist you in setting up your appointment. Once you have completed the counseling, you will receive a certificate which the lender will require to proceed with your loan. The certificate ensures that you have an understanding of reverse mortgage loans in general and your program specifically.

The majority of the reverse mortgage loans made today are government loans, insured by the Federal Housing Authority (FHA). The FHA is a division of the Department of Housing and Urban Development (HUD). The government reverse mortgage is known as a Home Equity Conversion Mortgage (HECM) and the government insurance charged on each loan is 2% of the available principal lending limit for each HECM loan insured by HUD. The insurance you pay guarantees you that no matter what happens to the lender in the future, HUD will always make sure that you receive your payments. If anything ever happened, this branch of the federal government will step in and make sure you receive your payments on a monthly basis (if you chose the payment option), or that your credit line is always available to you. A proprietary mortgage does not have the mortgage insurance premiums and there is no federal insurance to guarantee future payments. However, you only owe what you borrow (plus interest and any financed fees) and therefore if you take the full proceeds early in the term (a lump sum option) there is never a concern with future payments anyway. Proprietary programs typically have higher interest rates but lower up front fees.