Most reverse mortgages are a government insured
home equity loan
for seniors with some special features, benefits and qualifications.
The
most popular program is called a “HECM,”
(HOME
EQUITY CONVERSION MORTGAGE) provided by
FHA/HUD, also available is the Homekeeper
from Fannie Mae.
Qualifications:
Minimum age for any borrower is 62 years old.
Own
a single family home, town home, condo or a
1 to 4 unit building and in all cases the borrower must reside there as the primary residence.
Does not have to be debt free.
There
are no income or credit qualifications.
Features:
The
borrower is required to pay the property taxes
and hazard insurance.
The borrower retains ownership of the property.
The borrower is required to participate in a free
reverse
mortgage counseling session by a HUD approved
counseling
agency (Consumer Protection).
Benefits:
Receive
income
for life, a lump sum, a line of credit, or
a
combination of all three (see Beware of Annuities)
No repayment of the loan is required as long as the borrower
resides
in the home as their primary residence.
Income
from a reverse mortgage is tax free (consult your
tax advisor).
1-800-343-7611