A HUD Reverse Mortgage just makes sense.
The Home Equity Conversion Mortgage (HECM) is a government-insured reverse mortgage program for homeowners 62 and older, enabling you to withdraw some of the equity in your home. The HECM is a safe plan that adheres to Federal Housing Administration (FHA) guidelines, and can give older Americans greater financial security. Many seniors use it to supplement social security, pay off an existing mortgage, meet unexpected medical expenses, make home improvements, and more.
One of the primary advantages of a reverse mortgage is that it allows you to continue to own and live in your home – even if one of the co-borrowers passes away. You are responsible for paying property taxes and homeowner’s insurance, and making any property repairs. If you currently have a first or second mortgage on your home, you may still qualify.
The HECM reverse mortgage is different from a traditional mortgage or home equity loan in that you don’t need to make monthly principal and interest payments for as long as you live in the home. The loan is repaid only after you permanently leave the home.
The amount you are allowed to borrow depends on several factors, such as:
- Your age
- Type of reverse mortgage you select
- Current interest rates
- Location of your home
- Appraised value of your home
- Federal Housing Administration (FHA) lending limits for your area
