You may have heard of a reverse mortgage, but you’re not sure if it’s the right choice for you. You may have even put off looking into it because you’re not sure if you qualify. Fortunately, if you have some equity in your home and want to increase your income in your Golden Years, a reverse mortgage could be an excellent choice for you and your family.
Here are 10 questions you should ask when considering a reverse mortgage.
1. What is a reverse mortgage?
A reverse mortgage lets you convert the equity in your home to income or a line of credit.
2. Is there an age requirement for a reverse mortgage?
Yes. You must be at least 62 years old to qualify for a reverse mortgage.
3. Does my home qualify for a reverse mortgage?
To be eligible, your home must be a single-family home used as your primary residence, or a 2-4 unit multifamily home where you live in one of the units. HUD-approved condos and manufactured homes can also qualify.
4. Do I still own my home with a reverse mortgage?
Yes, you still retain ownership of your property with a reverse mortgage. This means you can sell the home and move at any time, and the money you make from the sale (after you pay your mortgage balance) is yours to keep.
5. Do I have to live in my home to have a reverse mortgage?
Yes, it must be your primary residence.
6. What happens if the mortgage balance exceeds the value of my home?
Nothing. The balance of your FHA-insured reverse mortgage doesn’t need to be paid until you move, sell your home, or die. When the loan is due, you or your family members will owe no more than the value of your home.
7. Where can I get a reverse mortgage?
Any lender authorized to make HUD-insured loans can offer reverse mortgages.
8. How would I receive payments from my reverse mortgage?
There are five ways to receive payments from your reverse mortgage:
- Tenure – you receive monthly payments from the lender for as long as you live and continue to occupy your home as your primary residence
- Term – you receive monthly payments for a fixed period of time
- Line of credit – you make withdrawals up to a maximum amount as needed
- Modified tenure – you can combine tenure with a line of credit
- Modified term – you can combine term with a line of credit
9. I still have questions, where can I get help with a reverse mortgage?
HOMEteam provides reverse mortgage counseling, which is required prior to applying for a reverse mortgage through the Federal Housing Administration (FHA).
10. Are HOMEteam’s services right for me?
Our counseling services for reverse mortgage are designed for individuals who are 62 or older who would like to remain in their home and access the equity they have accrued without selling or making additional monthly payments.
For more information about our reverse mortgage counseling, please contact our certified reverse mortgage counselor Debbie Wheeler at (603) 626-4663 x1400.