While reverse mortgage scams do exist, a reverse mortgage is a legitimate financial tool that allows homeowners age 62+ to access the equity in their home, without selling the house or making monthly payments like a traditional mortgage.
In addition to reverse mortgages offered by private lenders, the most common reverse mortgage is a Home Equity Conversion Mortgage (HECM) reverse mortgage.
Insured by FHA, protects homeowners
HECMs are the only reverse mortgages insured by the Federal Housing Administration (FHA).
These are non-recourse loans – so homeowners or their heirs will never be required to repay more than the value of the home at the time it's sold, even if the loan balance exceeds the home's market value.
No monthly payments
With a reverse mortgage, you receive monthly payments and do not repay the loan until the homeowner sells the home or passes. Remember, the balance will include interest and fees.
Some of the requirements to qualify for a reverse mortgage include:
- Homeowner must be at least 62
- Must be the primary residence
- Homeowners are still responsible for paying the property taxes, homeowners insurance, fees and maintaining the home.
- Other requirements depending on the type of reverse mortgage
A reverse mortgage is a financial tool that allows seniors to access the equity in their homes, providing financial security and flexibility. HECM reverse mortgages are insured by the FHA and designed to offer financial stability without making monthly payments. Reverse mortgages do come with costs such as closing fees and interest that accumulates.
To understand the details of how the loan works and ensure that a reverse mortgage aligns with your long-term goals, it’s important to research a reverse mortgage or seek professional advice. Finally, to protect against reverse mortgage scams, make sure to do business with a reputable lender.
Our team is here to help! Contact an Arizona Financial Reverse Mortgage Specialist for assistance.
This information is not from HUD or a government agency. You are required to maintain the home, pay property tax, HOA fees, and homeowners insurance. Consult your professional tax advisor.
