Is HUD counseling required?
Yes, and it may be done by telephone. The counselor works for a third party, non-profit agency specializing in this education. Their only purpose is to ensure all your questions are answered and you are fully informed about the transaction.
Are there limits to the usage of the proceeds?
There are no restrictions on the usage of the funds.
What am I responsible for doing after I have the Reverse Mortgage?
A senior may live in their home and there will never be a payment required. During the time the loan is in effect, you remain responsible for real estate taxes and homeowners insurance as well as any other bills associated with maintenance and upkeep of your home.
Does the bank own the home?
No. The lender does not share in any of the left over equity after the loan is paid off. The lender is paid only what is owed them.
Will this affect my Medicare?
How do I receive the money?
There are several ways to receive the proceeds from a reverse mortgage. Any combination of those listed below:
• Lump sum – a lump sum of cash at closing.
• Tenure – equal monthly payments as long as the homeowner lives in the home.
• Term – equal monthly payments for a fixed number of years.
• Line of Credit – draw any amount at any time until the line of credit is exhausted.
When does the loan get paid back?
Once the senior has moved out permanently or the last surviving spouse passes away, then within the next year the loan must be paid off, usually by the sale of the home. Your heirs will never owe additional money and can always purchase the home for 5% under the appraised value if the home is upside down.
Is the money taxable?
No. The money you receive is not taxable, it is tax free.*
Do both spouses need to be at 62?
No. Recently announced changes taking effect August 4th 2014 will allow a senior under 62 to be on the Reverse Mortgage and guarantee this person will be able to live in the home the rest of their life given they do certain things. Call for additional details.
What if the value of the house declines?
You or your heirs will never owe more than what the house is worth.
Please contact us at (877)567-7476 to have any additional questions answered.