Reverse Mortgages (HECM)
New Horizon Mortgage Concepts has enjoyed participating in Reverse Mortgages since 2006. A Reverse Mortgage (or Home Equity Conversion Mortgage) enables Borrowers over the Age of 62 to access the equity in their Home without ever having to make any monthly Mortgage Payments. Although there are no Mortgage Payments, the Home Owner is responsible for paying their Property Taxes and Homeowner’s Insurances as well as keeping their Home maintained. Like with other Home Equity Loans, the Value of the Home is determined by an Appraisal Inspection, however the amount of money Homeowners can borrow is determined by their age. Simply put…the older the Borrower…the greater the Loan Amount!
Reverse Mortgage Loans are insured by the Federal Housing Administration (i.e. the Federal Government) and they are truly designed with the needs and desires of the Borrowers being the number one priority. People utilize Reverse Mortgages for a variety of reasons including:
* Paying off their existing Mortgage…No More Mortgage Payments!
* Paying off Credit Card Debt
* Travel Funds
* Having a “Reserve Fund” for Emergencies
* Creating additional Monthly Income
* Purchasing a Home
In addition to functioning as a means of Refinancing a Home, Reverse Mortgages can also be utilized for Purchasing a Home. Here again, once the Home has been purchased there are never any Mortgage Payments due for as long as the Borrowers live in the Home. Homeowners are still responsible for paying: Property Taxes, Insurance and HOA Fees (If Applicable)
Unlike traditional Mortgages, there are really only three criteria required to qualify for a Reverse Mortgage:
1) The Borrower has to be 62 Years of Age or Older*
2) It has to be a Primary Residence**
3) There has to be sufficient equity in the Property***
Note: There is a Financial Assessment that looks at “Residual Income” (i.e. How much Money is “left at the end of the month” after Housing Expenses and Expenses on the Credit Report are Accounted for)…similar to VA Loans.
Please Contact New Horizon Mortgage Concepts to get additional Reverse Mortgage information and to determine how much money might be available to you.
* “Age Eligible” Borrowers (i.e. 62+) can have Spouses under the age of 62 on a Reverse Mortgage Loan (subject to certain limitations)
** Vacation, Income & 2nd Homes don’t qualify for a Reverse Mortgage
*** In the Case of a Reverse Mortgage Purchase…the Funds the Borrowers bring in to Close the Transaction represents the “equity”
California Department of Real Estate License #: 01408373
NMLS ID: 329381
Note: This Material is not from HUD or the FHA and has not been approved by HUD or a Government Agency.