The facts about reverse mortgages and nothing but the facts.
Ok, so here’s fact #1. It’s about to get harder to qualify for a reverse mortgage. Why? FHA is now requiring credit and income underwriting similiar to what is now done on forward mortgages. The new changes go into effect on April 27, 2015.
Fact #2. Don’t wait until you are out of retirement funds, can’t pay property taxes or falling behind on your mortgage payments to see if you qualify for a reverse mortgage. You don’t need to have that kind of pressure. Give yourself the gift of time to decide what you should do – Sell your home, get a roomate, get a reverse, move in with family etc.
Rounding out the top 3 in facts about reverse mortgages is a fixed rate reverse can be a very bad choice in accessing the equity in your home. The fixed rate reverse is a lump sum only product – you must take all the allowable funds at loan closing. Only the adjustable rate reverse provides payment options such as a line of credit or monthly income.
Well you you’ve stuck it out this far, so I’ll add a bonus fact. Before you speak to a loan officer about reverse mortgages, make sure they have been doing them for five or more years. These loans are tricky and a novice reverse mortgage loan officer may lead you in the wrong direction.
Just 3 facts and a bonus is my short list. You need to get properly educated on these loans and also work with folks that know what they are talking about. We have been originationg reverse mortgages for 15 years and in the mortgage business for 31 years – we are educators and give great advice.
I’d love to read your comments – please leave em if you got em.