What is a Reverse Mortgage?
A reverse mortgage enables homeowners 62 & older to convert home equity into tax-free cash without selling their home. A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that you built up over years of making mortgage payments can be paid to you.
However, unlike a traditional home equity loan or second mortgage, HECM borrowers do not have to repay the HECM loan until the borrowers no longer use the home as their principal residence or fail to meet the obligations of the mortgage. You can also use a HECM to purchase a primary residence if you can use cash on hand to pay the difference between the HECM proceeds and the sales price plus closing costs for the property you are purchasing.
You do not give up title to your home.
You make no monthly mortgage payments if you occupy your home as your primary residence, maintain your property, and remain current on the property taxes, homeowner’s insurance and HOA dues.
No prepayment penalties.
Although the loan is not due and payable until you permanently move out of the home, it can be paid off at any point without prepayment penalties.
There is no time limit to how long the homeowner(s) may remain in the property. If one or both homeowners remain in the home as the primary residence and remain current on the property taxes, homeowner’s insurance and HOA dues, neither you nor your spouse will be required to leave or sell the home.
Your home does not need to be free and clear. Elimination of the current mortgage is one of the most common reasons seniors apply for a reverse mortgage.
You, or your heirs, retain 100% of the remaining equity upon the sale of the home
It is beneficial to work with a local reverse mortgage licensed specialist in your area because they understand the real estate environment in Colorado. If you have any questions about applying for a reverse mortgage in Colorado, don’t hesitate to contact us. Our passion at 1st Reverse Mortgage USA is based upon educating and helping seniors.
Local Colorado Reverse Mortgage Specialists are available to answer your questions.
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Colorado Reverse Mortgage Specialists are available to answer your questions. Toll Free 877-217-0166
- You must be at least 62 years or older – Since reverse mortgages were designed to help seniors age in their home this loan is only available to individuals in retirement age.
- You must own your home – You must be on title of the home. You must also either own your home outright, or have a low enough remaining mortgage balance for the reverse mortgage loan to pay it off.
- Your home must be your primary residence – Again, because this loan was meant to help seniors stay at home, borrowers must live in the home and cannot live elsewhere for more than 12 consecutive months.
- You must complete a counseling session with a HUD-approved counseling agency – The U.S. Department of Housing and Urban Development (HUD) provides a list of third party agencies for you to choose from.
- Your home must be a single-family home or a 4-unit maximum multiple family home with one unit occupied by you. – Per HUD, the most common type of property eligible for a reverse mortgage is a single-family home. If your property is a multiple family home, then one of the units must be your primary residence.
- Your home can be a manufactured if it meets FHA requirements. – You can check the Federal Housing Administration’s (FHA) website for these requirements.
- Your home can be a condominium if it is HUD-approved.
There are certain kinds of homes that simply do not qualify for a HECM loan. Vacation homes or secondary homes are not approved under reverse mortgage qualifications because they aren’t considered the homeowner’s primary residence. Also, if your home is on income-producing land such as a farm, then it is not eligible either.
- You must be financially able to pay your property taxes, insurance, and home maintenance and any applicable HOA fees. – One of the most important things to remember about reverse mortgages is that you are still responsible for paying your property taxes, home insurance, and any home fees like Home Owner’s Association (HOA) fees for the life of the loan. The benefits of reverse mortgages only apply if you comply with all loan terms, because otherwise you may be at risk of defaulting on the loan.
- You cannot be delinquent on any federal debt.
These reverse mortgage qualifications and requirements may seem daunting, but don’t let that prevent you from applying. A licensed professional licensed professional can walk you through the whole process and let you know if there are other location-specific, property-specific, or borrower-specific requirements that you should be aware of. Many homeowners have found that once they satisfy the requirements for reverse mortgages, the benefits of this unique loan helped them achieve a better quality of life.
Reverse Mortgage Learning Section
Colorado Reverse Mortgage Specialists can meet with you in person.
Toll Free 877-217-0166
Reverse Mortgage – Putting Your Equity to Work
If you’re like many seniors, your home is your largest asset, and although you are concerned about the thought of borrowing against it, your house may be the only way to increase your income. Rising real-estate prices have caused many seniors’ homes to significantly increase in value. But unless they are willing to sell, it may be an inaccessible gain during a time in their lives when extra income and liquid assets would be very helpful.
Many seniors don’t qualify for home-equity loans based on income, and in any case, those home-equity loans require a monthly repayment, so they don’t solve the cash-flow problems.
There is a way to put this equity to work – Reverse Mortgages.
We have a dedicated team of Colorado Reverse Mortgage Specialists available to answer your questions.
How Do I Know If a Reverse Mortgage Is Right for Me?
A Reverse Mortgage might be worth considering if:
- You are committed to staying in your home, either because you don’t want to leave or because other housing alternatives are unappealing.
- You want to enhance your lifestyle and enjoy your golden years.
- You want a cushion for major expenses such as medical bills.
- You have a regular need for additional income to live on and your only significant asset is your home.
- You want the peace-of-mind that comes from knowing your financial needs are taken care of.
- You own your home free of debt or you have a small first mortgage.
- You don’t plan to leave your home to your heirs through inheritance.
- You live on a fixed income, and your only asset is your home equity.
CONTACT US TO GET THE MOST COMPREHENSIVE REVERSE MORTGAGE INFORMATION IN COLORADO.
Toll Free 877-217-0166
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