Top Flite Reverse
Presented by Top Flite Financial, Inc.
What Is A Reverse Mortgage?
A Home Equity Conversion Mortgage (HECM), or a Reverse Mortgage, allows homeowners to borrow money using their home as collateral. With Reverse Mortgages, your home remains in your name. However, unlike a traditional mortgage, monthly principal and interest payments are eliminated.
Homeowners ages 62 and older most commonly utilize a Reverse Mortgage as a good source of income when funds run dry.
Subject to meeting loan qualifications the minimum age for program qualification is 62. You must still live in the home as your primary residence, continue to pay required property taxes, homeowners insurance, HOA/Condo fees, and maintain the home according to FHA requirements. Borrowers should seek professional tax advice regarding reverse mortgage proceeds.
An Alternate Option For Financial Flexibility
Reverse mortgage borrowers retain ownership and title to their home. It’s yours just as before, but now you can benefit from the equity building in your home for years. A Home Equity Conversion Mortgage (HECM) loan gives you the peace of mind of a government guaranteed FHA (Federal Housing Administration) backed loan where you will never owe more than the home is worth. You can get a reverse mortgage on your primary residence, and no repayment is due until the last borrower passes away or permanently leaves the home.
As a protection, all those seeking a reverse mortgage must obtain HUD counseling (from an independent third party) before incurring any costs associated with the loan. While proceeds from a reverse mortgage are not subject to personal income taxation, borrowers should seek tax advice on how proceeds may affect government needs-based programs such as Medicaid and Medi-Cal.
The Process of Getting A reverse Mortgage
Meeting with a qualified reverse mortgage professional is critical to learning the facts about a reverse mortgage, the amount you may qualify for, and the various ways you can get your money. Our reverse mortgage professionals will help analyze your situation so you can decide if a reverse mortgage is right for you.
HUD counseling is mandatory for all reverse mortgage borrowers. Consult with your reverse mortgage professional for a list of approved counselors, and complete this step as soon as possible. Many times, counseling can be completed over the telephone. You will receive two certificates, one to keep and the other to send to our office.
Meet with your trusted reverse mortgage professional and decide if a reverse mortgage is right for you. Our reverse mortgage professional can meet with you at our office or your home and help guide you through the application. You will have a complete copy of ALL the documents for you and your trusted advisors to review.
Upon receiving your HUD counseling certificate, we will contact you to arrange for an appraisal of your property. Reverse mortgages use a full FHA appraisal. The value of your home is based on what comparable properties in your neighborhood have sold for recently.
We (the lender) will begin to process your paperwork. This process includes the appraisal, title report, and checking the balance of any liens/mortgages to be paid. We will be in contact regularly during this time.
We will forward your file to the loan underwriter for final approval when the processing and all paperwork are complete. We will work to satisfy any conditions/requirements needed to close the loan.
Closing & Funds Disbursed
Once your loan has been approved by underwriting, we will contact you to arrange for the signing of your final loan documents. We will confirm your payment plan or partial lump sum (how you want to receive your money). Once you’ve signed the closing documents, you have three business days to cancel the loan if you choose to do so. Your settlement agent should receive the proceeds on the fourth business day after closing.
The Facts About Reverse Mortgages
Myths About reverse mortgages
- The Bank takes your home
- It’s only a last resort
- It’s free money
- My equity is safe
- It’s not a safe program
- You retain title to your home
- Many financially saving retirees use a reverse mortgage as a financing tool
- It’s a specialized loan
- Your equity is subject to the housing market
- FHA insured reverse mortgages are fully guaranteed
FHA reverse mortgages or Home Equity Conversion Mortgages (HECM) come with several guarantees and protections that are part of the FHA (Federal Housing Administration) insurance. The FHA insurance provides the following protection and peace of mind to the borrower and their children:
- The borrowers will never owe more than the home’s fair market value
- If the loan balance ever grows higher than the value of the home, FHA pays the lender the difference when the last borrower dies or leaves the home.
- Payments taken from the bank holding the reverse mortgage are guaranteed. If the bank ever goes into default, the payments are guaranteed to be made by FHA.
- If the loan balance grows higher than the home’s value, the lender cannot take title. FHA insures that you can live in your home as long as the basic loan obligations are met (insurance and property taxes, etc.).
Top Flite Financial, Inc. is not acting on behalf of or at the direction of HUD/FHA or the Federal Government. Subject to meeting loan qualifications – Minimum age for program qualification is 62. You must still live in the home as your primary residence, continue to pay required property taxes, homeowners insurance and maintain the home according to FHA requirements.