Florida Reverse Mortgages

A Reverse Mortgage is a special type of mortgage that enables a homeowner to use the equity of the home while offering a great deal of flexibility to manage certain financial needs. Unlike traditional home equity loans, no repayments on the Home Equity Conversion Mortgage (HECM) are required for as long as you live in your home.

With a Florida reverse mortgage, the homeowner receives an installment based on the home's equity according to the payment plan selected. There is allowance to change the way the money is paid any time and as many times after origination.

There Are Several Requirements In Obtaining A Reverse Mortgage:

• Both spouses must be at least 62 years of age or older.
• The home must be the primary residence.
• The home either needs to be paid in full, or have a mortgage balance that can be paid off with the proceeds of the Reverse Mortgage.
• The approval process has nothing to do with your income or credit rating.

The Amount Of A Florida Reverse Mortgage Depends On 3 Factors:

• The interest rate (Lower rate = Greater allowance).
• The age of the youngest borrower (Higher age = greater allowance).
• The appraised value of the home (Higher appraisal = greater allowance).

Repayment Options Of A Florida Mortgage Reversal:

• Proceeds from the sale of the home: The remaining equity will be distributed to the estate.
• Refinance the Home: If your family or estate wish to keep the home, a conventional mortgage can be used for repayment and any additional equity remains in the control of your family members or the estate.
• Life Insurance Proceeds.

The Loan is Repaid When:

• The last borrower passes away.
• The home is no longer the borrowers primary residence.
• The home is sold.
• The borrowers transfer title of the property to someone else.
  

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Benefits Of A Florida Mortgage Reversal:

• There is no repayment on the mortgage as long as the owner lives in the home.
• The proceeds can be used for any reason that is seen fit.
• Owner retains ownership of the home, not the Lender.
• A Reverse Mortgage is not taxable.
• Social Security and Medicare benefits are not affected
• The FHA Reverse Mortgage is a Federally insured program.
• After the estate repays the lender, the remaining equity is paid to your heirs.
• There are a number of payment options available.
• Federal National Mortgage Association (FannieMae) buys virtually all Reverse Mortgages.

The fees involved in a Florida reverse mortgage from a private lender is above the fees of traditional mortgage loans. There is an insurance premium of 2 percent of the loan and a 2 percent origination fee in addition to normal closing cost. Thus a $300,000 loan would have $12,000 beyond the normal closing costs. There is also a monthly service charge added to the total amount of the loan.

Different Florida Reverse Mortgages Available:

Federal National Mortgage Association (FannieMae) - Home Keeper

Home Equity Conversion Mortgage (HECM)

Department of Housing and Urban Development (HUD)