A reverse mortgage loan is a special type of loan that converts a portion of the equity in the borrower’s home into available funds.
The most prevalent reverse mortgage in New Hampshire currently is the federally insured Home Equity Conversion Mortgage (HECM). The federal government, housing and mortgage professionals, and senior advocates developed the unique features of the reverse mortgage to allow older people access to the money they put into their home over their working years. The equity converted to cash through the HECM is then available for mature homeowners to use as they see fit.
Benefits of a Reverse Mortgage
Merrimack Mortgage reverse mortgage specialists have worked with thousands of people who desire to stay in their homes for as long as possible. For many, the benefits of aging in place, in the community where they have roots, friends, and memories, are invaluable, and only the individual can put a price on those benefits. A reverse mortgage allows you to access the equity in your home, retain ownership of the home, and have optional principal and interest payments. Furthermore, with the HECM, no matter how large the loan balance, you never have to pay back more than the appraised value or the sale price of the home.
Get the Facts: What You Should Know
- Reverse mortgages are available to homeowners 62 years of age or older.
- The lender does not buy or take title to the home.
- HUD regulates the origination and servicing of HECMs, determines maximum allowable fees, and insures the loans through the FHA.
- Borrowers are not required to pay back the loan unless they sell or otherwise vacate the home.
- No monthly payments are required toward the loan balance, but borrowers must maintain the home and keep current on property taxes and homeowners insurance.
Types of Reverse Mortgages
A HECM can be used to refinance your current property or to purchase a new home.
Refinance HECM – This financial tool unlocks the equity in your current home and opens up many options and tools to achieve your goals. You can receive the funds in a flexible array of options so that it can be fine-tuned to your specific situation.
The refinance HECM is currently the most popular option. However, if you ever have thought about relocating, “rightsizing” your home, or moving for any reason, definitely explore the powerful options and flexibility a purchase HECM can provide you.
Purchase HECM – The purchase HECM allows you to use a down payment and a HECM mortgage to buy a new home. If you are looking to relocate and want the flexibility and power of a reverse mortgage, a Merrimack Mortgage reverse mortgage specialist will help you buy the home you want where you want. A Merrimack Mortgage reverse mortgage specialist will work with you to help you determine the best options to maximize the usefulness of the reverse mortgage.
If you have questions about reverse mortgages and how one might benefit you, please contact Charley.
We have originated more than $500 million of real estate loans to thousands of New Hampshire property owners and are happy to share our experience and expertise with you.