Reverse Mortgage In Laredo

A reverse mortgage is a type of mortgage developed exclusively for homeowners aged 62 and up. It enables individuals to turn a portion of their home’s equity into cash while remaining in the home and owning it. The loan is referred to as a reverse mortgage because, unlike a regular mortgage, the lender makes monthly payments to the borrower.

The reverse mortgage concept was developed to assist seniors with limited income in using the accumulated wealth in their houses to fund basic monthly living expenses and pay for health care. There are no restrictions on how the proceeds of a reverse mortgage can be used. As a comprehensive retirement plan component, more homeowners are utilizing reverse mortgages to supplement their financial stability.

Types of Reverse Mortgages

• HECM 

Home Equity Conversion Mortgage (HECM) is the most commonly used type of reverse mortgage. It is run by the Federal Housing Administration (FHA). HECM lets you take out some equity in your home, and you decide how you get your money back. You may get it in one lump sum or a specified monthly amount over a period. It may even be a mix of both. 

• HECM Eligibility Requirements 

  • You must be 62 or older;
  • Own the property outright or with a low mortgage balance;
  • Use the property as your primary residence;
  • You must not be in arrears on any government debt;
  • Attend a consumer information workshop led by a certified HECM counselor.

• Single Purpose

A single-purpose reverse mortgage is an agreement in which lenders pay borrowers in exchange for a percentage of the borrower’s home equity. Borrowers must use these payments for a specific purpose that the lender has approved.

Single-use reverse mortgages restrict how borrowers can use the funds they receive. Lenders can stipulate that funds be used for home maintenance and upkeep or for payments that are in the lender’s best interest, such as property taxes and homeowners insurance. As a result, they are often easier to get and have lower interest rates than other types of reverse mortgages.

• Proprietary

A proprietary reverse mortgage is a loan from a private lender that enables senior homeowners to access the equity in their homes. They are not federally insured and are not as strictly regulated as home equity conversion mortgages (HECMs).

Proprietary reverse mortgages are also known as jumbo reverse mortgages. They are sought by individuals who want access to more funds than the federally insured reverse mortgage. They may be taken as a lump sum, structured as a monthly annuity, or distributed over specific years.

Apply for a Reverse Mortgage in Laredo

Call us if you are a senior wondering if a reverse mortgage is right for you. Call (956) 307-3422 to speak with one of our Reverse Mortgage Specialists.