Reverse Mortgage/HECM 2018-08-07T18:15:05+00:00
REVERSE MORTGAGE / HECM

What is a reverse mortgage?

A reverse mortgage is a type of home equity loan that allows you to convert part of the equity in your home into cash without having to sell your home or pay additional monthly bills. Reverse mortgages are typically catered towards older homeowners, but they have also become a great retirement planning tool for many homeowners. This type of mortgage does not need to be repaid until the borrower passes away, sells the home, or permanently moves out.

There are three kinds of reverse mortgages:

  1. Single purpose reverse mortgages – loans offered by some state and local government agencies, and nonprofits
  2. Proprietary reverse mortgages – private loans
  3. Federally-insured reverse mortgages, also known as Home Equity Conversion Mortgages (HECMs) – a type of Federal Housing Administration (FHA) insured reverse mortgage

How do reverse mortgages work?

With a regular mortgage, the borrower makes monthly payments to the lender, but with a reverse mortgage, the lender makes payments to the borrower.

There are several factors that are accounted for that determines the amount of funds you can receive from a reverse mortgage:

  • Age
  • Value of home
  • Interest rate
  • Lesser of appraised value or the Federal Housing Administration’s HECM mortgage limit of $636,150

Who would benefit from a reverse mortgage?

A reverse mortgage makes senses for individuals who:

  • Are age 62 and older who own a home or have small mortgages.
  • Don’t plan to move.
  • Can afford the cost of maintaining their home.
  • Want to access the equity in their home to supplement their income or have money available for a rainy day.

Should you get a reverse mortgage?

Pros:

  • Does not require monthly payments from the borrower.
  • Proceeds can be used to pay off debt or settle unexpected expenses.
  • The money can pay off the existing mortgage.
  • Funds can improve monthly cash flow.

Cons:

  • Fees and other closing costs can be high.
  • Borrower must maintain the house and pay property taxes and homeowners insurance.
  • A reverse mortgage can complicate one’s wish to keep the house in the family.

Why should you choose Mortgage Possible?

Our team offers a 24-hour loan center for future homeowners who don’t have time to apply for a loan during regular business hours. We offer quick loan approvals and provide our clients with the best loan options for their needs and financial situations. Our team members are well-versed in Reverse Mortgage rules and requirements and will ensure you are knowledgeable about our mortgage process prior to committing to a loan.

For any questions about the Reverse Mortgage process or any of our other home loan services, give our team at Mortgage Possible a call to speak to a local team member who can answer all of your home loan questions. Contact Us Today!

How It Works

Apply For a Reverse Mortgage Loan

Apply For a Reverse Mortgage Loan

Frequently Asked Questions

First, you will need to submit a mortgage application with us, either in person, by phone, or using our easy-to-use online form, whichever makes you feel more comfortable. One of our licensed loan officers will get in touch with you and discuss your mortgage needs and objectives with you. Next, we will check your credit scores and request you to submit the necessary supporting documents so that we can verify your identity, the source of your income, and your current debt for underwriting purposes. An appraisal will also be performed on your selected property. Once you have submitted all the documents and your loan is approved with no outstanding items, we will then prepare the closing documents so that you can get ready to sign your loan package. After your loan is funded, you are on your way to move into your new home.

No, Mortgage Possible does not charge an application fee for you to apply for a mortgage.

Mortgage Possible has one of the fastest turnaround times in the industry, and we offer 20 day closings, but every borrower’s situation is different, and due to documentation requirements and varying response times from the borrower, the average time to close a loan may be higher.
A mortgage refinance refers to obtaining a new loan for the purpose of lowering your mortgage payments, converting your existing loan into a more affordable or manageable loan, or getting cash out on available equity on your home. There may be a minimum waiting period from the date you closed your previous mortgage, based on the type of refinance you are applying for. Mortgage Possible also recommends that you check with your existing lender regarding any prepayment penalties. There will be fees involved when refinancing your home, although you may have the option of rolling these costs into your new loan. Please call one of our licensed loan officers at  855.418.3362  to discuss whether a refinance is right for you.
Most types of mortgages require a minimum amount of down payment, except for VA and USDA programs. You may also be eligible for down payment assistance programs that can help you towards minimum down payment requirement on some of the loan programs. On Conventional Mortgages, your lender will require you to pay a Private Mortgage Insurance (PMI) premium as part of your monthly payments if you put down less than 20% of the purchase price of the property. There are government loan programs available with less stringent down payment requirements as well, such as an FHA loan that will require only a 3.5% down payment, but again, these programs also require mortgage insurance premiums. Finally, keep in mind that the amount of down payment you put down for a house will also affect your Loan-to-Value (LTV) ratio, which could then affect the amount of loan you are able to qualify for, or whether or not you will qualify at all.
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