Wondering what it takes to qualify for an HECM reverse mortgage?
HECM stands for Home Equity Conversion Mortgage.the FHA insured reverse mortgage (HECM) makes up 95% of the market. Seniors are leveraging this program due to the fact it is easier to qualify vs. a traditional mortgage; they can access the equity without a new mortgage payment, and maintain ownership of the home.
HECM loans also called reverse mortgages makes up 95% of the market, these are all FHA insured loans. Seniors are utilizing this program more and more every year due to the fact it is easier to qualify vs. a traditional mortgage; they can access the equity without a new mortgage payment, and maintain ownership of the home.
Before finding out if you are qualified why not consider the pros and cons of the program to make sure it’s a good fit for your retirement.
Reverse mortgages are a good fit if:
- You plan on living in this home for long term.
- You are financially fit to pay for taxes, expenses, and homeowners insurance.
- You understand that the loan will accrue interest meaning you will owe more the longer you keep the loan.
- Are trying to eliminate a current debt or mortgage payment.
Reverse mortgages are not designed for:
- Short term financing since the fees are high.
- If you plan on moving in the next 5yr.
- Are uncertain about your health and could potentially need care.
To be eligible for an HECM you must:
- Be 62 years of age or older (at least one borrower on the title).
- Demonstrate the ability to upkeep with repairs, property taxes and insurance.
- Have a certain amount of income and credit scores.
- The property must be your primary residence (no vacation/investment homes).
- The property must meet FHA guidelines being a single family or multi-unit with owner occupying one of the units (max of 4 units). Manufactured homes do qualify as well under more conditions.
- Attend and pay for a counseling session is mandatory.
- Pay appraisal fee to determine property value; this is with all lenders, some can credit this fee back at closing.
For a more detailed information please contact our HECM Advisor Dylan Cohen
Assent, Inc. | 18881 Von Karman Ave. | Suite 1075 Irvine, California
310-409-2219 Office | firstname.lastname@example.org | NMLS#1572310