62 or older?  A Reverse Mortgage could offer Financial Freedom 

Is a Reverse Mortgage right for you?

A Reverse Mortgage (also known as a HECM - Home Equity Conversion Mortgage) is a home loan that is insured by the Federal Government.  It is classified as an FHA loan.  Instead of making payments to a lender, the lender makes payments to you in a lump sum or over time.  You can pay off the loan any time but you are not required to make any payments or pay the loan back until you sell the home, move away permanently, or die 

Benefits of Reverse Mortgages

~ Pay off your existing mortgage and in turn, have no monthly mortgage payment

~ Access any additional equity in your home to pay off other bills, do home improvements, or any other purpose

~ Work with a local South Carolina company with over 30 years of experience.  We will go over your options carefully and help you determine if a Reverse Mortgage is a good decision for your situation

~ You will not be required to make any monthly payments or pay the loan back until you sell the home, move away permanently, or die (unless your co-borrowing spouse continues to live in the home as their primary residence).  But you do have the option to pay the loan off at any time.  Note that if you fail to pay your property taxes or home insurance, the lender can require the loan to be paid off

~ When you sell the home or die, any remaining equity in the home will go to you or your heirs/relatives.  Your heirs/relatives can sell the home or may choose to obtain a loan to refinance and pay off the Reverse Mortgage and retain ownership of the home

Who qualifies for Reverse Mortgages?

~ You must be at least 62 years old

~ The home must be your primary residence

~ Must have a strong equity position in the home.  This will depend on your age and current interest rates, but it is helpful if  your current mortgage balance is less than 60% of your home's appraised value.  If your home is owned free and clear with no mortgage, then your chances of getting a Reverse Mortgage will be good

~ There are minimal credit and income requirements for Reverse Mortgages so qualifying in these areas is typically easier than for other types of mortgages

Additional information about Reverse Mortgages

~ While Reverse Mortgages don't require you to make a monthly payment, you will still be required to maintain homeowners insurance on your home and to pay your annual property taxes

~ With just some basic information, we can put together a detailed proposal for you which will help you decide if a Reverse Mortgage is a good financial decision.  If you decide to move forward (and you can change your mind any time during the process), one of the very first steps will be getting HUD approved Reverse Mortgage counseling.  This is usually done over the phone and we will provide you with a list of counselors to choose from and walk you through this process.  There is a fee of $125 for the counseling 

~ Like traditional mortgages, Reverse Mortgages have closing costs which are mostly financed into the loan.  The primary closing costs are 1) the FHA mortgage insurance  2) origination fee to the lender  3) appraisal, and  4) attorney fees to the closing attorney.  The FHA mortgage insurance is 2% of your home's appraised value (if your value is $300,000, the FHA mortgage insurance would be $6,000).  The mortgage insurance will be the biggest part of the closing costs but FHA allows it to be financed into the loan.  The lender origination fee can be as high as $6,000 per FHA guidelines depending on your loan size.  While lenders have no control over the FHA mortgage insurance, Gulfstream Mortgage will always try to keep the origination fee as low as possible and we regularly beat other lenders when it comes to closing costs on Reverse Mortgages.  FHA also charges an annual fee for mortgage insurance and it is equal to 0.5% of the outstanding mortgage balance.  This is not an out of pocket expense and is simply added to the loan balance.  Overall, the only out of pocket expense you may have will be the appraisal fee which is on average, $600.00

In summary, homeowners who will benefit the most from Reverse Mortgages are those who plan to stay in their home for as long as possible and have built up a decent amount of equity in their home.  Every situation is different and we will be happy to review yours and give you our best advice.

If you would like to learn more about Reverse Mortgages, give us a call at 803-771-0080 or fill out the short form on this page and we'll get back with you promptly.