Seniors-Use the equity in your home for retirement years, ease your budget crisis. FHA Insured Program. No house payments, a loan that doesn’t have to be paid back as long as you live in the home. Retain ownership of your home. No income qualifications, or Credit history requirements. No Restrictions on how you use the funds.
. 1. What is a reverse mortgage? A reverse mortgage is a special type of home loan that lets a homeowner convert a portion of the equity in his or her home into cash. The most popular type of reverse mortgage is a FHA insured Home Equity Conversion Mortgage (HECM). The equity built up over years of home mortgage payments can be accessed by the homeowner. But unlike a traditional home loan or second mortgage,no repayment is required until the borrower(s) no longer use the home as their principal residence. 2. Can I qualify for a HECM reverse mortgage? To be eligible for a FHA insured reverse mortgage,you must be 62 years of age or older and own your home. The home must also be your primary residence. Borrowers are further required to receive consumer information from HUD-approved counseling sources prior to obtaining the loan. 3. Can I apply if I didn't buy my present house with FHA mortgage insurance? Yes. While your property must meet HUD minimum property standards,it doesn't matter if you didn't buy it with an FHA-insured mortgage. Your new HECM reverse mortgage will be a new FHA-insured mortgage loan. 4. What types of homes are eligible? Your home must be a single family dwelling or a two-to-four unit property that you own and occupy. A townhome, units in a FHA approved condominium project and some manufactured home are also eligible. The home must be in reasonable condition,and must meet HUD minimum property standards. In some cases,home repairs can be made after the closing of a reverse mortgage with underwriting approval. 5. What's the difference between a reverse mortgage and a bank home equity loan? With a traditional second mortgage,or a home equity line of credit,you must have sufficient income and debt-to-income ratios to qualify for the loan and you are required to make monthly mortgage payments. The reverse mortgage is different in that you make no monthly mortgage payments and your income is not a large factor in qualification. The amount you may borrow depends on your age,the current interest rate,and the value of your home (or FHA's mortgage limits for your area,whichever is less). Generally,the more valuable your home,the older you are,and the lower the interest,the more you can borrow. You don't make mortgage payments because the loan is not due as long as the house is your principal residence. Like all homeowners,you still are required to pay your real estate taxes,insurance,maintain the property,etc. But with an FHA-insured HECM,you cannot be foreclosed or forced to vacate your house because you "missed your mortgage payment."