A reverse mortgage is a special type of home financing available to homeowners 62 years or older. It allows them to access some of their built-up equity, which can either be paid out in a lump sum to the homeowner or be received in monthly payments as “income.” It’s their choice. The technical term for a reverse mortgage is a Home Equity Conversion Mortgage.
A reverse mortgage is a type of loan in which a borrower with a sizable home equity is granted a loan based on the value of the borrower’s property. The amount is loan either as a lump sum or in terms of monthly installments.
· One question that frequently arises – and is a subject of misconceptions – is what happens to a house after a reverse mortgage (home equity Conversion Mortgage) ends. Some people believe the bank automatically owns the house, but that isn’t necessarily the case.
The HECM is the official federally insured reverse mortgage program that enables seniors to tap into their home equity without a monthly mortgage payment or giving up ownership of the home. No mortgage payments are required as long as at least one borrower (or non-borrowing spouse) is living in the home and paying the required property charges.
A Home Equity conversion mortgage (hecm) may also be known as an FHA reverse mortgage. This is a home loan that allows borrowers age 62 and older to access the equity in their homes for supplemental funds.
The term HECM, pronounced “heck-um”, means Home Equity Conversion Mortgage. The major difference between the HECM program and a reverse mortgage is the HECM program is insured by the federal housing administration (fha).
You can use the listing below to see if you qualify. If you meet the eligibility criteria, you can complete a reverse mortgage application by contacting a FHA-approved lender. You can search online for a FHA-approved lender or you can ask the HECM counselor to provide you with a listing. The lender will discuss other requirements of the HECM program, such as first year payment limitations, available payment options, the loan approval process, and repayment terms.