HECM Reverse Mortgage

what is a reverse mortgage

A reverse mortgage enables the homeowner to access their home equity without having to make monthly payments. The proceeds are always tax-free. A homeowner can refinance into a reverse mortgage and eliminate their mortgage payment, get a cash lump sum, a line of credit, a monthly annuity, or a combination of  the above options. This loan can also be used to purchase a home as well.

The easiest way to understand a reverse mortgage is to imagine a regular mortgage with the flexibility of not making your monthly payment. The mortgage interest simply gets added to the back of the loan. This is the basic concept of a reverse mortgage.

A reverse mortgage is NOT for everyone. Your decision to pursue this loan program will depend a lot on whether you’re planning on passing your home down to your heirs. Please contact us for further info. You can also visit MyColoradoReverseMortgage for more information.

HOW TO QUALIFY FOR A REVERSE MORTGAGE

1) Must be at least 62 years old. No exceptions to this rule. An often alternative for someone who doesn’t meet the age minimum is a home equity line of credit.

2) Must have the ability to pay for ongoing property tax and homeowners insurance. Please keep in mind that the reverse mortgage will not include your property taxes, homeowners insurance, or any other expenses such as a monthly HOA fee. It’s important to have enough saved to keep up with these expenses.

3) No minimum credit score or income requirementsThe HECM reverse mortgage doesnt have any credit score or income restrictions. This is one of the main differences that separates a reverse mortgage from other loan programs. The loan process is intended to be easy and stress-free. how to qualify for a HECM reverse mortgage

4) Must have sufficient equity in your home. We will pull up all of the recent sales in your neighborhood to help us establish an estimated value of your home. We use Valuecheck.com to help us establish a value for your home. This is a no obligation market value analysis that will help us figure out how much you qualify for and what to expect after the appraisal is completed.

5) Must go to counseling session. The counseling is mandatory and is presented by a HUD approved counselor. We will provide you with a list of local counselors so you can schedule a class close to your home. Counselors are available all over Colorado but some folks will need to travel. If traveling is not an option, please ask the counselor to either schedule counseling over the phone or possibly ask them to come to your home.

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