Reverse Mortgage

Scott English, Mortgage Broker, NMLS#133064

interest only mortgageScott English specializes in a number of mortgage options, including reverse mortgages. A reverse mortgage is a type of loan where someone with considerable equity in his or her home borrows against the value of the owned home. This person can receive the funds as a lump sum, a fixed monthly payment, or a line of credit. What separates a reverse mortgage from a normal “forward” mortgage is that loan payments are not required to be made by the homeowner. 

What ends up happening is that the entire loan balance becomes due once the homeowner dies, moves away, or sells the home. Federal regulations require that the loan be structured so that the loan amount does not exceed the value of the home or that the borrower’s estate does not become liable for paying the difference if the loan balance ends up larger than the home’s value. This is possible due to a decrease in the home’s market value or the if the borrower lives for a very long time. 

Reverse Mortgage Facts

  • Reverse mortgages are loans designed for seniors aged 62 and older. 
  • Reverse mortgages enable homeowners to convert their home equity into cash without mortgage payments each months. 
  • Reverse mortgages are generally federally insured, but beware of scammers that target seniors. 
  • While many seniors can benefit from a reverse mortgage, they are not for everyone. Be sure to research the best situation for yourself before you purchase a reverse mortgage. Contact Scott English today to find out if a reverse mortgage is best for you! 

Types of Reverse Mortgages

The three types of reverse mortgages are: 

  1. Home Equity Conversion Mortgage (HECM) – HECM’s represents almost all reverse mortgages on home values below $765,600 and is the most common type of reverse mortgage. 
  2. Single-Purpose Reverse Mortgage – This type of reverse mortgage is offered by state, local, and nonprofit agencies. It is the least expensive option and homeowners can expect to pay less in interest and fees for this type of reverse mortgage.
  3. Proprietary Reverse Mortgages – These types of reverse mortgages are backed by private lenders, rather than the federal government. These loans benefit homeowners whose homes are appraised at higher values, typically higher than the $970,800 limit for federally backed HECM’s. 

How Funds Are Received in a Reverse Mortgage

  1. Lump sum 
  2. Equal monthly payments (annuity)
  3. Term payments
  4. Line of credit
  5. Equal monthly payments plus a line of credit 
  6. Term payments plus a line of credit 

Talk to Scott English today to learn more! 

Get Approved Quickly

It is common to have many questions about a reverse mortgage and whether or not it is right for you. You might also be wondering about which lender is best for you and your situation. That’s why Scott English can help you make the best decision with multiple lender options. 

By working with Scott, you can get a pre-approval letter quickly as soon as all of your information is received (income, mortgage scenario, etc.). Sometimes pre-approval can be even be provided on the same day! 

Scott’s fast pre-approval process will allow you to move forward with confidence, knowing that once you are ready to officially apply it will be a seamless closing period. 

Speedy Quote

Take the first step to getting the best home loan for you.