- Take advantage of HECM counseling to ensure reverse mortgage is right for you
- Search for a reverse mortgage counselor online
- Don't skip this step!
Counseling for a Reverse Mortgage - A mandatory benefit
An FHA-insured Reverse Mortgage is called a Home Equity Conversion Mortgage (or "HECM"). A reverse mortgage enables you to withdraw some of the equity in your home. You choose how you want to withdraw your funds, whether in a fixed monthly amount or a line of credit or a combination of both.
You can also use a HECM to purchase a new home (so long as it will be your primary residence) if you are able to use cash on hand to pay the difference between the reverse mortgage loan amount and the sales price plus closing costs for the home you are buying.
While there is a great deal of content available, from AARP, bills.com, and others on reverse mortgages information, whether a reverse mortgage is right for me (or you), and the pros and cons of reverse mortgages, the FHA mandates a very important step in the reverse mortgage process for HECM loans: reverse mortgage counseling.
You cannot receive a HECM loan unless you can present your lender with a certificate of completion of a HECM counseling session. These valuable sessions, costing at time of writing only $125, are an important step in the process to ensure that a reverse mortgage is right for you and that you understand how much you will get, what the loan will cost, the impact of a HECM on your heirs and so on.
HECM counselors will discuss program eligibility requirements and the financial implications and alternatives to obtaining a reverse mortgage. They will also discuss the situations in which the reverse mortgage becomes due and payable (typically when the owner or owners have both moved out or are deceased). Upon the completion of HECM counseling, you should be able to make an independent, informed decision of whether a reverse mortgage is a good fit. You can search online for a HECM counselor.
Philadelphia, PA | October 02, 2011
October 03, 2011
If you have signed final paperwork, then you have three days to rescind your decision. Because of the timeliness required, make sure you communicate with the lender and send the notice in a way that you can prove that it was done within the three day window.
October 03, 2011
If you have signed final paperwork, then you have three days to rescind your decision. Because of the timeliness required, make sure you communicate with the lender and send the notice in a way that you can prove that it was done within the three day window.
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