Manage episode 328293237 series 3336448
Reverse Mortgage Explained Simply
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In this video we talk about the reverse mortgage, explained simply. Some people think the reverse mortgage is something weird or mystical.....a scam even.
Well, it's really not. A reverse mortgage is just a regular loan that's insured by FHA. Many people have had a regular mortgage loan in the past. A reverse mortgage works just like a regular mortgage, but there three tiny, key differences.
1. There is an age requirement. You have to be age 62 or older to qualify for the FHA reverse mortgage. If you happen to be talking about the proprietary reverse mortgage, the age requirement is 55. In some states it's a little bit different, but for the most part it's 55.
2. The second difference is that there is an equity requirement. With the FHA reverse mortgage you can borrow anywhere from 45% to 75% of the value of your home. It just depends on the age. If you're 62 you can borrow about 45% (and that can potentially change based on interest rates). At age 95 you can borrow about 75% of your homes value. Beginning at age 62, the percent you can borrow increases just a little bit with each passing year.
3. The third difference is that there is an no monthly payment due to the bank for as long as you live or for as long as you live in your home. You still own the home when you do a reverse mortgage so you'll need to pay taxes and insurance still. It really is that simple. It a loan that allows you to access a portion of the equity in your home and convert it to usable funds....but, there is no monthly payment.
www.LifeSourceMortgage.com Is not a lender or bank nor are we part of HUD / FHA. We are however a licensed mortgage broker In California, Colorado, and Idaho that specializes in reverse mortgages, fast closing purchase loans, and more. Anyone that inquires and requests more information may be contacted by the owner or employee of this site. LifeSource Mortgage, CA BRE#01869699. NMLS#321759, ID MBL#2080321759.