Provides financial security and independence for homeowners, age 62 years and older. Home What is the Process? Free Video & Brochure Reverse Mortgage Calculator Frequently Asked Questions Please Contact Me Please Submit a Question About Us Testimonials Frequently Asked Questions What are the eligibility requirements for a reverse mortgage? How much money can I get? How do I receive my money? Do I get taxed on the money I receive? Am I limited as to how I use my reverse mortgage funds? Does the bank hold title to my house while my reverse mortgage is outstanding? Am I responsible for paying my property tax and homeowner's insurance? What costs are associated with a reverse mortgage? Is there more than one kind of reverse mortgage? Do I have to pay any fees to the reverse mortgage lender during the course of my loan? When does my reverse mortgage have to be paid off? How is the interest rate determined on the reverse mortgage? What are the eligibility requirements for a reverse mortgage? You must be a homeowner, at least 62 years old and own your own home. The home must be owner occupied. You may have a current mortgage on your property but it must be low enough to be paid off with the reverse mortgage proceeds. All homeowners are required to participate in a reverse mortgage counseling course during the processing of the reverse mortgage. The session lasts about one hour and can be done in person or over the phone. Your lender can arrange this for you. Back to Top How much money can I get? The amount of money you qualify for is based on your age, how much your home is worth and the current interest rate at the time of closing. There are several types of reverse mortgage loan products and these can also affect how much money you are eligible for. To determine how much you may qualify for use our reverse mortgage calculator. Back to Top How do I receive my money? There are several different options to choose from. You can take the money in a lump sum, set up a line of credit, opt for fixed monthly payments, or a combination of all three. Back to Top Do I get taxed on the money I receive? No. The equity in your home is considered your money and not additional income. All the funds from a reverse mortgage are tax free. Back to Top Am I limited as to how I use my reverse mortgage funds? No. You can use the funds however you would like, it is your money. Borrowers have used reverse mortgage funds to supplement retirement income, travel, home improvement, healthcare expenses, education for loved ones, etc. the list goes on and on! Back to Top Does the bank hold title to my house while my reverse mortgage is outstanding? No. You retain title to your home during the course of the loan. Back to Top Am I responsible for paying my property tax and homeowner's insurance? Property tax and homeowners insurance must be current at all times. If you wish, the lender can setup an account and pay your taxes and insurance as they come due. However, the money to setup this account will come from your reverse mortgage proceeds and you must specify the number of years you would like the lender to pay them for. Most reverse mortgage borrowers prefer to pay their taxes and insurance themselves as the bills come due. Back to Top What costs are associated with a reverse mortgage? The costs associated with a reverse mortgage are very similar to costs on a traditional "forward" mortgage. The costs include an origination fee, appraisal fee, flood certification fee, doc prep fee, title and escrow fees, recording fees and termite inspection fee. There is also an upfront mortgage insurance premium fee if you are obtaining a government reverse mortgage. All fees except the appraisal fee can be rolled into the loan. For homeowners who qualify for conventional reverse mortgages, the fees can be reduced or eliminated depending on the program chosen. Back to Top Is there more than one kind of reverse mortgage? Yes. The most popular reverse mortgage loan product is the 'Home Equity Conversion Mortgage." It is a government loan program insured and guaranteed by the Dept. of HUD. These loans work best if the appraised value of your home is under $500,000. For homeowners whose property values are over $600,000, a conventional reverse mortgage program works best. Back to Top Do I have to pay any fees to the reverse mortgage lender during the course of my loan? A reverse mortgage was created so seniors do not have to pay any out of pocket fees during the course of the loan. However, there is a monthly servicing fee of $30-35 which is added to your loan each month to offset the lender's clerical expenses for servicing your loan. If you obtain a HECM loan, you will also have a small monthly mortgage insurance premium added to your loan each month which offsets the government's overhead for sponsoring and administering the program. Back to Top When does my reverse mortgage have to be paid off? When the last borrower has permanently vacated the residence, due to sale of the home, moving out of the home, or passing away, the loan will become due. Payoff includes any amounts that have been disbursed to you or others , fees associated with the reverse mortgage and accrued monthly finance charges. Once the payoff on the reverse mortgage is completed, the remaining equity in the home will go to you or your heirs. An important feature of the reverse mortgage is the "non-recourse" feature. This means you can never owe more than your home is worth. Back to Top How is the interest rate determined on the reverse mortgage? For the HECM loan, the interest rate is adjusted either monthly or annually and is based on the "One year Treasury Constant Maturity Rate," which changes weekly. For monthly HECMs the interest rate charged each month is equal to the current one Year Treasury rate plus a margin of 1.5%. The annually adjusting HECM has a margin of 2.1% and adjust once a year. The conventional reverse mortgages are also adjustable and are tied to the LIBOR rate plus a margin. The rate changes every 6 months on the conventional programs. Back to Top Call to speak to one of our specialists in your area (800) 928-1121 Serving the needs of Southern California seniors for more than 25 years.