Reverse Mortgage Solutions - Blake Mortgage
Why Scottsdale Mortgage Why Scottsdale Mortgage

Reverse Mortgage Solutions

Home | Reverse Mortgage Solutions

We’re your Trusted Partner for residential and commercial mortgages

Phone: 480-699-1055 |
Email: harry@blakemortgage.com

What is a Reverse Mortgage?

A loan for seniors age 62 and older
Converts a portion of home equity into cash with no monthly mortgage payments*
Majority of reverse mortgages are HECMs (Home Equity Conversion Mortgage, a federally insured program)

*Taxes and insurance must still be paid on time. Any costs to keep up property maintenance must still be paid. Failing to meet these requirements can lead to default.

Do you have a question about our process of getting a new home purchase loan? Learn more below, or feel free to contact us. We look forward to hearing from you!

How Does it Work?

  • You must live in home as your principal residence.
  • No repayment of the mortgage is required until you permanently move out, sell the home, or pass away.
  • You are required to continue paying property taxes and insurance and maintain the home according to FHA guidelines.

Advantages

  • No monthly mortgage payments*
  • Non-recourse loan –you’ll never owe more than what home is worth
  • Leverage crucial retirement cash liquidity
  • No limitations on how you use funds
  • No pre-pay penalty
  • You must live in the home as your main residence.

Eligibility

  • Be 62 years of age or older
  • Own the property outright or have considerable equity
  • Occupy the property as your principal residence
  • Not be delinquent on any federal debt
  • Participate in a consumer information session from HUD

Is a Reverse Mortgage Right for Me?

Things to Consider

  • Prepare for counseling meeting. Schedule a time now!
  • Continue keeping property taxes and homeowners insurance current
  • Home value, owner age(s), and current interest rate determine eligible amount to borrow

Non-Recourse Loan

  • The HECM is insured through FHA and is a non-recourse loan.
  • The homeowner or their heirs will never be asked to pay back more than the value of the home, even if the debt has grown to be greater than the value.*
  • *If the heirs choose to keep the home, they will need to pay off the loan at 95% of the fair market value of the home, as determined by a third-party appraiser.

Considering a Reverse Mortgage?

Reverse Mortgages are an excellent option for homeowners 62 and older. Reverse mortgages require no monthly mortgage payments as the loan is repaid when the owner passes away, leaves home permanently, or sells it. In this page, we will explain reverse mortgages to you in a manner that makes them easier to understand. The complex nature of reverse mortgages can sometimes be confusing, but we are here to simplify it.
Do you have a question about our process of getting a new home purchase loan? Learn more below, or feel free to contact us. We look forward to hearing from you!
Understanding Reverse Mortgages To understand reverse mortgages, we need to break them down into what they are, and they are not. Reverse mortgages can have a lot of benefits but do have some drawbacks, and so it is essential to be detailed about them from the start. Some of the things that reverse mortgages are and are not are listed below.

What Are Reverse Mortgages?

A reverse mortgage is a loan against your home’s equity and with no required monthly mortgage payments. Reverse mortgage loans are designed to meet the needs of retirees who are typically on a fixed income. What reverse mortgages offer is tax-free cash for virtually anything the homeowner desires, from social security income supplementation to long-term care payments it is all available.
The tax-free aspect of reverse mortgages is very appealing. Because a reverse mortgage loan is a loan like any other loan, loan funds received are not taxable. While this is mostly the case, it is always a good idea to check this with a tax professional.
At Blake Mortgage we are happy to provide all the advice that pertains to the loan, both the benefits and the downsides. We understand better than anybody that this is a complicated loan, but one that you may wish to take advantage of. We are here to facilitate the process.

What are Not Reverse Mortgages?

There is a common misconception that a reverse mortgage is like selling your home to the bank, but this is not true. As a homeowner, you are not relinquishing your title or ownership rights at any point. Reverse mortgages send you monthly statements outlining the interest rates and property taxes that you are still responsible for. There is not a monthly payment, and that is one of the significant differences.
Is a Reverse Mortgage Right for Me? A reverse mortgage loan is something that at Blake Mortgage, we often advise to consider carefully. If at retirement age, a client feels that he or she cannot afford specific desires or needs, then a reverse mortgage may be right for them. A reverse mortgage can help the homeowner stay in the home they love while also enhancing their retirement years.
One should consider that the loan is not for everyone as there are individual costs associated with it. Appraisal and origination charges are only some of the expenses which make this loan not advisable for people who cannot afford it, are moving soon, or may require care in an inpatient facility. Being able to fully realize the benefits of a reverse mortgage loan should be the deciding factor, and that is something we have always advised our clients.

Who Qualifies?

Anyone over the age of 62 with a property under the name should qualify for a reverse mortgage loan so long as they can prove that they have enough residual income to pay the property taxes and interest on the loan. There is required third-party counseling that must also take place to qualify since the Federal Housing Administration requires that the borrower fully understand the terms of the loan. So long as all the requirements are met, the loan can be signed and be underway.

Home Equity Conversion Mortgage

A Home Equity Conversion Mortgage, also known as a HECM, is the most common of all reverse mortgages. The main advantage of this mortgage is that the borrower does not have to pay any interest until the loan reaches maturity. The bank is not eating away at your home’s equity, and there is no recourse other than the property. A lender cannot go after family members since there is no debt left by the end of the loan’s life. Home Equity Conversion Mortgages continue to be the most popular choice. Financial Assessment
In 2014, FHA introduced the “Financial Assessment” for the reverse mortgage loan qualification. Lenders must check a borrower’s ability to keep up with their obligations such as homeowner’s insurance and property taxes. 24 month period is taken int5o consideration, during this period the borrower cannot have any missed payments on consumer credit or property charges to qualify for the loan.

Pay It in Full

There is always the option of paying the loan in full without any penalty. If possible, paying the mortgage in full assures that your heirs do not have to worry about having to resell or refinance the property once you pass. The standard time for this process is 12 months, and if that time elapses without action from the heirs, the lender will, unfortunately, have no choice but to foreclose on the property.

Be Mindful of Benefits

If the homeowner is receiving benefits from the state, a reverse mortgage can indeed affect them. Because Social Security and Medicare are public benefits, they are not affected, but all other need-based benefits are. A reverse mortgage can affect eligibility and leave a homeowner without benefits he may desperately need. Before looking into reverse mortgages, it is best to weigh the pros and cons.
We at Blake Mortgage are always happy to walk you through all these regulations in person at our Scottsdale office.

Looking for the Best Assistance on Reverse Mortgages?

Our years of experience in the financial sector gives us an edge when advising about reverse mortgage loans. We will provide you with all the benefits you need. We want retirees to have an opportunity to live their final years to the fullest, and that is why we offer this complicated but many-a-time beneficial loan.

We’re Here to Help

We are always available to answer any questions our clients may have about reverse mortgage loans. We are here to serve you each step of the way.