HECM Reverse Mortgage, or home equity conversion mortgage, is the ONLY reverse home loan insured by the U.S. Federal Government. This loan is available through FHA approved lenders.

The idea of the HECM Reverse Mortgage is, that a senior citizen can change a part of his home equity into cash money to get more disposable money for increased medical bills, for instance.

The HECM Reverse Mortgage

allows a senior to withdraw money as a lump sum, as monthly payments, as a credit line or as a combination of all these. This makes the home equity conversion mortgage as a very flexible form of a service. You can later change your payment options with a fee of $ 20.

2. A Senior can buy a new home with the HECM Reverse Mortgage, if he is able to pay the diffrence between the HECM Reverse Mortgage proceeds and the sales price and the closing expenses of the new property.

3. The HECM Counselors will guide you, whether this kind of a loan is clever to take, about eligibility requirements, financial influences, about the costs and about the closing time.

If at closing the sales price of your home does not cover all the costs and the capital of the HECM Reverse Mortgage, the compulsory mortgage insurance will pay the difference. You can never owe more than the value of the home and no payments can be taken from your other assets.

Home Equity Reverse Mortgage Borrower Requirements.

You must be age 62 or over and own a home, which is totally paid or has a small amount of mortgage left. Actually the title can include maximum 3 borrowers, who all must fulfil the same requirements.

The home must be the principal residence and you have to go through the HECM Counselor Guidance.

5. The Amount Of The HECM Reverse Mortgage.

The amount you can borrow depends on the following things:

a. The age of the borrower ( the older you are, the more you can borrow )

b. The interest rates ( the lower the rate, the more you can borrow)

c. The appraised value of your home ( the expensive your home is, the more you can borrow ).

Your income or credit information have no meaning, because the HECM Reverse Mortgage will be taken against the equity of your home. You will not make any monthly back payments, but all costs will be financed when the loan will be closed.

6. What Kind Of Properties Are Accepted?

All properties must meet the FHA property standards and flood requirements:

a. 1-4 units homes, when at least one unit is for the borrower.

b. Single family homes.

c. HUD-approved condominiums.

d. FHA approved manufactured homes.