Reverse Mortgages
With a reverse mortgage (sometimes referred to as a a home equity conversion loan), homeowners of a certain age may use home equity for living expenses without having to sell their homes. The lending institution pays out funds determined by the equity you've accrued in your home; you get a lump sum, a monthly payment or a line of credit. The loan doesn't have to be paid back until the homeowner sells his home, moves out, or dies. When you sell your property or is no longer used as your primary residence, you (or your estate) must repay the lender for the money you obtained from the reverse mortgage in addition to interest and other fees.
Here Are the programs available
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HECM Annual Adjustable Rate
HECM Annual is a reverse mortgage loan whose interest rate adjusts only once a year, with a "lifetime cap" to ensure that your client’s rate will never go beyond a certain percentage over the initial rate. In addition, there’s an "interval cap" that guarantees that the interest rate cannot increase by more than a certain percentage annually. And to help give your client’s financial flexibility, they have the choice of taking their funds as a lump sum, monthly advances, a line of credit or a combination of these. |
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HECM Fixed Rate
With an interest rate that’s established at the loan closing — and fixed for the life of the loan — your clients always know exactly how much interest is accruing on their loan. However, with a HECM Fixed Rate, homeowners are required to take all of their money at closing in one lump sum. This may be a desirable choice if they’re using their HECM to pay off an existing mortgage or cover other immediate needs. |
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HECM Monthly Adjustable Rate
The interest rate on this HECM fluctuates on a monthly basis, but it also offers more options for homeowners — including a "rate cap" that guarantees that the rate will never go up more than a certain percent over the initial rate (depending on the loan options they choose). Your customers can select a lump sum draw, line of credit, monthly advances, or a combination of these options. For example, a customer might choose to take some of the cash up front and put the rest in a line of credit, so it’s available when and if they need it |
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HECM for Purchase
This home financing solution helps your clients purchase a new home that will better fit their lifestyle by taking out a loan on the home they are buying. If you’re interested in expanding your business with HECM for Purchase, we can help! As an industry leader with this product, we have the keys to unlocking this sales opportunity. We can teach you what you need to know to be successful, show you how to educate consumers as well as realtors and builders who can help you expand your customer base, and give you the support of HECM for Purchase experts. |
Who can Participate?
The requirements of a reverse mortgage generally are being sixty-two or older, maintaining your home as your primary residence, and having a small remaining mortgage balance or having paid it off.
Many homeowners who are on a fixed income and have a need for additional funds find reverse mortgages ideal for their circumstance. Interest rates can be fixed or adjustable while the money is nontaxable and doesn't affect Medicare or Social Security benefits. Your home is never at risk of being taken away from you by the lending institution or sold against your will if you live past your loan term - even if the property value creeps under the balance of the loan. Call us at 305 891 6500 to look into your reverse mortgage options.
Secured Horizon Financial Group can answer questions about reverse mortgages and many others. Call us: 305 891 6500.