Frequently Asked Questions

1) What is a Reverse Mortgage?
A reverse mortgage is a low-interest loan for homeowners 62 years of age or older that uses a home’s equity as collateral. The loan amount is a percentage of the home’s value determined by the age of the youngest homeowner. The loan does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away. At that time, the estate has approximately 12 months to repay the balance of the reverse mortgage or sell the home to pay off the balance. All remaining equity is inherited by the estate. The estate is not liable if the home sells for less than the balance of the reverse mortgage. There are no credit, income or employment requirements. Reverse mortgage are backed by the U. S. Government.

2) Do I quality for a reverse mortgage?
You must be 62 years of age or older and own your home. There are certain requirements as far as the amount of equity you must have. Your property does not have to be debt free. Consult with a loan officer to discuss the amount of equity that is required. It will differ depending on the age of the homeowner.

3) What type of properties are eligible?
Single family residences, qualified condominiums, townhouses, mobile homes, manufactured homes and duplexes are eligible. The property must be your main residence.

4) Is the money that I receive from the reverse mortgage tax-free?
Yes, the funds that you receive from a reverse mortgage is tax free and is not considered income. You may use the proceeds for anything you wish.

5) Do I keep title to my property?
You always retain title to your property with a reverse mortgage. You may sell your property at any time. The lender can never take your house or force you to sell it, as long as you are living in it.

6) Do I make payments during the reverse mortgage?
There are no mortgage payment requirements. However you are responsible to stay current on your homeowners insurance and property taxes. You may payoff the reverse mortgage at any time with no prepayment penalties.

7) When is the reverse mortgage due?
The reverse mortgage is due when you sell, permanently move out of the property or the last surviving borrower passes away.

8) Do you need good credit to qualify for a reverse mortgage?
There are no credit or income requirements to qualify for a reverse mortgage. You can qualify for a reverse mortgage even if you have poor credit or no credit at all.

9) How much can I borrow?
The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home or FHA's mortgage limits ($625,500) for your area, whichever is less. Generally, the more valuable your home is, the older you are and the lower the interest rate, the more money you receive.

10) How can I use the money from the reverse mortgage?
There are no restrictions on how you use the money from your reverse mortgage. Common uses are for home repairs or improvements, medical expenses, monthly bills, property taxes, payoff current mortgage.

To apply or inquire about a reverse mortgage call 1-800-865-3414