REVERSE MORTGAGES FOR SENIORS | HECM SENIORS 2012

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Reverse mortgages for seniors is currently changing the way seniors use their home to retire, and is allowing people just like you the option to use your home as a way to fund your retirement. A Reverse mortgage is one of the most popular solutions for seniors who are currently looking for either a steady stream of income, and or a large lump sum . This tax free income can be used anyway the homeowners chooses, and you will not have any payments due on your mortgage.

There are 4 HECM programs to satisfy the needs of every seniors – whether you are looking for an adjustable rate or fixed rate; lump sum, credit line, or even a lifetime income.

Reverse mortgages were designed specifically for seniors since it allows seniors to live in their home while receiving payments from the bank.

“100,000+ seniors last year alone benefited from the government sponsored HECM reverse mortgage as it allows senior homeowners to retire comfortably in their own homes”

Older homeowners have been really interested in the reverse mortgage program since it has so many positives features with the main benefits being allowing the homeowners over 62 to live in home and receive monthly income for lifetime. Like any other mortgage product there are fees involved and with a reverse mortgage it is very important to shop around for the best rate ( HECM mortgage insurance premium is about 2% ( HECM saver mip is .01%.)

One of our reverse mortgage specialist can explain to you all the benefits of a reverse mortgage program. If you are over 62 years of age a reverse mortgages can be the right solution for you.

What Are The Qualifications For Reverse Loans

  • must be 62 years of age
  • must own the home
  • be primary residence
  • have never defaulted on government debt

Recap of the pros of the HECM reverse mortgage

  • never have to make a monthly mortgage payment
  • you keep ownership of the home
  • you are allowed to pass the home to your heirs
  • you can sell the home at any time ( keep all profits )
*** currently Metlife is the first reverse mortgage lender to apply financial underwriting which includes reviewing your income, payment history, and credit scores. 
What are the different programs available for seniors who choose the HECM loans for their retirement
HECM different types
HECM Fixed Standard

HECM Fixed Standard - main features

  • fixed interest rate
  • upfront lump sum ( not taxed )
  • upfront mip 2%
  • pay interest on full lump sum

Designed for seniors who want or need the maximum amount of equity out of their homes and are also interested in a fixed rate HECM. You will pay the full 2% upfront mortgage insurance and some lenders will work with you on eliminating origination fee on the loan.

Currently many seniors who have a first mortgage or large liens against the home are utilizing the HECM Fixed to pay off their existing debts, improve their retirement cash flow by getting rid the debt payments, while this is a costly option it works very well for many seniors ( specially when taking home appreciation and offset savings from higher interest mortgage loans.)


HECM Adjustable Standard

HECM Adjustable Standard - main features

  • adjustable interest rate
  • select how receiving the income/funds ( credit line, monthly income )
  • upfront mip 2%
  • pay interest on amount borrowed only

seniors who also want the full equity out but do not mind taking an adjustable rate mortgage option which has lower interest rates due. You will also be liable for the 2% upfront mortgage insurance which goes into the loan costs, lenders will most likely charge an upfront origination fee of 1-2%.

The lower adjustable rates can come in handy when you need some new income/funds in your retirement and have plans to sell the home in a few years. Seniors can also look at this option to pay off an existing mortgage as the adjustable rates are very low right now.

HECM Saver Fixed

HECM Saver Fixed - main features

  • receive a lump sum upfront
  • not taxed ( never taxed )
  • upfront mip .01% (substantial savings )
  • pay interest on full amount upfront
  • less equity available compared to HECM standard

pay less in upfront mortgage insurance (.01%), receive a smaller portion of the homes equity and get into a fixed rate option – this is usually utilized by seniors who have a substantial amount of equity in the home – money will come as a credit line or as monthly income ( or combination).

HECM Saver Adjustable

HECM Saver Adjustable -

  • receive credit line or monthly income
  • not taxed ( never taxed )
  • upfront mip .01% (substantial savings )
  • pay interest on borrowed portion only
  • less equity available compared to HECM standard programs

dont mind an adjustable rate mortgage or receiving less of your homes equity – also utilized by seniors with more equity in the homes – this can be one of the cheapest options of the HECM loans as the interest rates for the adjustable programs are the lowest – mortgage insurance is also (.01%) thus savings is realized with this option.

Seniors can qualify for this program as there is no income requirement and also no credit score requirement in order to qualify, the lenders are concerned mainly with age/property.

There are changes that will arise this October so we recommend that if you want to a reverse mortgage you start comparing them now, as any changes can make it more difficult to qualify for the program. There is currently talks about introducing some restrictions on who can qualify, including making seniors pass a income ratio test where you need to have enough income compared to how much you property taxes and insurance will cost.

The property taxes and insurance are the only two bills that’s seniors need to pay with a reverse mortgage loan.

“Seniors should take advantage of the current low interest rates and ease to qualify for the reverse loan program now, before major changes take place. When and if income and credit scores are a new requirement this will make it tougher to qualify for.”

for more information we recommend you to visit the following pages

reverse mortgage rates
reverse mortgages how they work
reverse mortgages pros and cons
reverse mortgage information
reverse mortgage calculator
reverse mortgage lenders


REVERSE MORTGAGES FOR SENIORS | HECM REVERSE MORTGAGE FOR SENIORS 2012 By Paul Galante – Add me to your circles

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