Reverse Mortgages

Reverse Mortgages in Florida

 

CTC Mortgage offers the Home Equity Conversion Mortgage (HECM). This is the only reverse mortgage insured by the U.S. Federal Government. A reverse mortgage allows you to convert a portion of your home equity into cash. You do not have to sell your home or take on additional monthly debt payments.

 

Requirements

• The homeowner must be 62 or over
• The homeowner must remain on the title
• The homeowner must live in the house
• The homeowner must meet with a HECM counselor to receive consumer information. These are usually free or at a low cost.
• Minimal income and credit requirements

 

Types of homes that are eligible

• Single family home or a 2-4 unit home with one unit occupied by the borrower
• HUD-approved condominiums and manufactured homes that meet FHA requirements

 

Benefits

• FHA insured
• The homeowner continues to retain ownership of the property
• No monthly mortgage payments required
• Adjustable and fixed rate options available
• The money can be put towards anything and it can be received all at once, in monthly advances, or in a line of credit

*Keep in mind that the homeowner is still responsible for paying property taxes, utilities, and hazard and flood insurance premiums.

 

HECM Costs

There are various costs associated with reverse mortgages. The fees include mortgage insurance premiums, origination fees, and servicing fees. These can be financed or paid for using the proceeds from the loan. It is important to note that a reverse mortgage is a non-recourse loan. This is beneficial because it means even if the value of the home decreases, the homeowner will never owe more than the value of the home.

The remaining balance on the reverse mortgage is due if any of the following occur: the homeowner sells the home, permanently moves, the end of the loan term is reached, or they pass away. The lender does not take ownership of the home if the homeowner passes away. Although the heirs will not be responsible for repayment, they can work with the loan servicer to repay the loan through refinancing or buy the home for themselves.