The Must-Know Reverse Mortgage Facts

Once the “rainy day funds” have dried up, it is necessary to take corrective measures in order to keep home matters under control. A reverse mortgage is a great start. Let’s pretend we’ve set the appointment and have agreed to the terms on the contract. Your hand is on the pen, ready to write but something brings pause to your hand. You’re having second thoughts. Let’s address some common issues applicants may have by providing pressing information that every applicant must know.

Who Can Apply

Reverse mortgages are limited to applicants who are 62 years of age, and over. The basis of this loan is to assist retirees in need of a supplemental income. You must also live in and own a qualifying home. Defining qualifying as any home that is not a mobile home or trailer, an apartment complex, or a vacation rental. There is an exception for single family homes with multiple units, so long as the owner also resides in one of the units. Since you as the applicant meets these standards you are eliglible to apply.

How Hard is The Process?

The toughest part of the reverse mortgage application process is finding a reputable, trustworthy lender with your best interest as the priority. However unlikely they are to find, it is recommended that you conduct your business with a financial instituation you already have an established relationship with, that way you are likely to be treated fairly; like when establishing the value of your home. A tool called a “reverse mortgage calculator tool” is used by the lender, and you wan to be sure that all factors be considered during those calculations to ensure you receive all that you are entitled to..

Where Do I Start?

There are private and public (government) lenders to choose to borrow from. Though most private lender financial agreements are similar, the govenerment reverse mortgage lenders are classified as “HECMs,” or Home Equity Conversion Methods and are only slightly different in certain areas. Like the calculator tool the government uses to establish home equity, factor’s in percentages of market shares which can be difficult with fluctuations.

If you choose to go private, public or both, you will still be required to undergo credit checks, and maintain ownership and residency of your home in order to quality. Break any terms of your agreement and you can and likely will lose your home.