Eight Things to Know About a Reverse

ByJim

Eight Things to Know About a Reverse Mortgage

Reverse Mortgages are becoming popular in America. The U.S. Department of Housing and Urban

Development (HUD) created one of the first. HUD’s Reverse Mortgage is a federally-insured private,

and it’s a safe plan that can give older Americans greater financial security. Many seniors use it to

supplement social security, meet unexpected medical expenses, make home improvements, and more. About Reverse

A reverse mortgage is a special type of home loan that lets a homeowner convert a portion of the equity

in his or her home into cash. The equity built up over years of home mortgage payments can be paid to

. But unlike a traditional home equity loan or second mortgage, no repayment is required until the

borrower(s) no longer use the home as their principal residence. HUD’s reverse mortgage provides these

benefits, and it is federally-insured as well.

To be eligible for a HUD reverse mortgage, HUD’s Federal Housing Administration (FHA) requires that

the borrower is a homeowner, 62 years of age or older; own your home outright, or have a low mortgage

balance that can be paid off at the closing with proceeds from the reverse loan; and must live in the

home. You are further required to receive consumer information from HUD-approved counseling

sources prior to obtaining the loan.

Yes. While your property must meet HUD minimum property standards, it doesn’t matter if you didn’t

buy it with an FHA-insured mortgage. Your new HUD reverse mortgage will be a new FHA-insured