If you're not already familiar, a reverse mortgage is when the lender makes payments to the homeowner instead of the homeowner paying the lender as with a traditional mortgage. You can receive money from a reverse mortgage in one lump sum, monthly payments, as a line of credit, or a combination of these options. You're only charged interest on money received.
The homeowner doesn’t have to repay the loan as long as they live in the home, but they must have the financial resources to pay property taxes, homeowner’s insurance and, if applicable, homeowner's association fees.
The loan is repaid when the home is vacated or the homeowner dies. Any proceeds or remaining equity beyond the amount owed can be passed along to heirs, but no debt is transferred to heirs.
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If you're already familiar with a reverse mortgage, here's some information about what you should expect while it is in process.
Federal guidelines require mandatory counseling on implications and alternatives. We will provide you with a list of approved local counselors.
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Loan file is turned into the processing department. The processor will immediately order your appraisal and begin to process your loan file.
Appraiser contacts you to schedule an appraisal. Report available 3-5 days after the appraisal is performed.
Appraisal is reviewed and file submitted for underwriting. Approval is typically available within 3 days.
Once your loan is approved, Processing will contact you to discuss any outstanding documentation (conditions).
Once outstanding conditions are supplied to processing, the file returns to underwriting for final review. Typically takes 48 hours.
Once underwriting reviews the conditions, they clear the loan for closing. The closing department will contact you to set up a closing date. Closing can take place any time after this point.
Do not make any large purchases without consulting loan officer. Spending cash or incurring new debt could negatively impact your ability to qualify for a mortgage.
If you ever have any questions, please feel free to reach out to us!