Reverse mortgage lenders approve borrowers more easily than traditional lenders. Find out if you qualify.
It's Easy to Qualify for a Reverse Mortgage
Today's seniors are finding financial relief from an innovative mortgage product called a reverse mortgage. Reverse mortgages are easy to qualify for and require no monthly mortgage payments. A homeowner 62 years old or older could qualify as long as there is enough equity available and the property is eligible. Read through the following basics and consider enjoying your golden years by speaking to a reverse mortgage lender today.
From time to time, there are reverse mortgage lenders that offer proprietary reverse mortgages for borrowers younger than the typical reverse mortgage age of 62 years old. If you are younger than 62, contact a reverse mortgage lender to see if such a proprietary product is available to you.
Most reverse mortgages today are Home Equity Conversion Mortgages, HECM (pronounced Heck'em). HECMs are government-backed reverse mortgages offered through HUD and insured by the FHA. You must be 62 years old or older for a HECM.
Eligible Property Types / Valuing The Home
For the majority of reverse mortgages, single family homes or 2-4 unit properties are eligible. Condominiums and manufactured homes can also be eligible but must meet specific requirements.
Reverse mortgage lenders consider the appraised value of the home when determining how much money they are willing to lend. Recent comparable sales are extremely important. If the property is unique or difficult to compare, the reverse mortgage lender may require multiple appraisals and / or use a very conservative estimate of value.
To be eligible as collateral for a reverse mortgage, the property must be owner-occupied. Occupancy can sometimes be a little tricky. You must live in the property offered as collateral for the majority of the year. If the property has more than one unit, at least one unit must be owner-occupied. So if you have a two-year jaunt around the world in your immediate future, a reverse mortgage is not for you. Your health is a consideration as well. A long stint in a nursing or rehab facility can cause your reverse mortgage to be called in. Read your paperwork carefully and understand the occupancy requirement.
No Credit, Income, or Assets Are Considered
Unlike a traditional mortgage, there are no monthly mortgage payment to make. Your credit rating is not considered, unless you have an open bankruptcy or delinquent federal debt. You do not need to prove any income or posses assets other than your home. The maximum claim amount is calculated using the appraised value of the property, the youngest borrower's age, the current reverse mortgage rate, and the FHA loan limit if applicable.