Good Faith Mortgage LLC Reverse Mortgage Application

Home Equity Conversion Mortgages (HECM): Unlocking Home Equity for Seniors

FHA reverse mortgages, known as Home Equity Conversion Mortgages (HECM), offer homeowners aged 62 and older a unique opportunity to convert their home equity into cash without monthly payments. This financial tool was designed to help retirees with limited income leverage their accumulated home wealth for basic living expenses and healthcare costs. However, the use of reverse mortgage proceeds is unrestricted.

Key Features:
• Uses home equity as collateral
• Loan amount depends on age, home value, interest rates, and upfront costs
• No repayment required until the home is sold or the borrower(s) pass away
• After the last homeowner leaves or passes, the estate can satisfy the HECM by paying the lesser of the mortgage balance or 95% of the current appraised value

HECM Payment Plans:

1. Line of Credit: Allows unscheduled or installment withdrawals. Unused portion can grow over time.

2. Term Payment: Fixed monthly payments for a specified period.

3. Tenure: Equal monthly payments as long as the borrower resides in the home.

4. Modified Tenure/Line of Credit: Combines a line of credit with scheduled monthly payments.

5. Modified Term/Line of Credit: Combines a line of credit with monthly payments for a fixed period.

HECM for Purchase:
This option allows seniors to buy a new primary residence using reverse mortgage proceeds. Benefits include:
• Flexible repayment options
• Ability to afford a desired home
• Preservation of savings and retirement assets
• Improved cash flow

Borrowers must maintain property-related taxes, insurance, and maintenance as ongoing loan obligations. Repayment is required upon selling the home, passing away, moving out, or failing to meet loan obligations.

The HECM program offers seniors various ways to access their home equity, providing financial flexibility in retirement. As with any significant financial decision, it's advisable to consult with a qualified professional to determine if a reverse mortgage aligns with your long-term financial goals.

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Home Refinance

Home Purchase

Home Equity

Reverse Mortgage

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