LOAN PROGRAMS

Reverse Mortgage

From paying off a mortgage, to creating consistent monthly income, to smarter tax planning, a reverse mortgage can unlock the equity in your home for a more secure retirement.

What exactly is a “reverse mortgage”?
With a reverse mortgage, more accurately now called a Home Equity Conversion Mortgage (HECM), homeowners age 62 or older receive a portion of their home’s equity while living in the home, and with no monthly mortgage payments. The funds are income tax-free, and borrowers retain ownership and title to their home as long as they:
• Live in the home as their primary residence.
• Continue to pay required property taxes and homeowners insurance.
• Maintain the home according to Federal Housing Administration requirements.

What are the benefits and uses of a reverse mortgage?
From eliminating your monthly mortgage payment to paying for unexpected expenses, a reverse mortgage can help provide financial flexibility and relieve many of the financial pressures you face in retirement. A HECM can allow you to:
• Pay off an existing mortgage, monthly bills, or healthcare expenses to increase cash flow.
• Make needed home repairs or modifications to live more comfortably.
• Replace taxable withdrawals from 401(k) or other retirement plans with tax-free reverse mortgage proceeds.
• Establish a line of credit for emergencies or occasional expenses.
• Help a child or grandchild with major expenses, like a down payment on a home or college tuition

What amount can you receive from a reverse mortgage?
The amount of money that you can receive from a HECM depends on a number of factors, such as your age, the type of reverse mortgage you select, current interest rates, and the appraised value of your home.

How can you receive the money?
Depending on the specific program you choose, there is a range of options for receiving the proceeds of a reverse mortgage, including:
• A monthly income stream
• A lump sum payment
• A line of credit
• Any combination of the above