Choosing A Reverse Mortgage Lender
A reverse mortgage loan can be quite beneficial for the financial security of qualified seniors, ages 62 and over who have sufficient equity in their homes. The funds from a reverse mortgage loan can be used to supplement retirement income, pay off an existing mortgage and other debt, pay for medical care, prescriptions, in-home care, make home improvements or repairs or just to save for that rainy day fund.
Since not all reverse mortgage companies provide the same level of service, it is important that you choose your lender carefully and weigh all of your options. The Federal Trade Commission (FTC) recommends the following steps before choosing a reverse mortgage lender. See here
Check Reverse Mortgage Rates/Costs
The Mortgage Insurance Premium (MIPs) is the same for all lenders as it is required by the HECM program guidelines, but origination fees, interest rates, closing costs and servicing fees may be different.
Decide Which Reverse Mortgage Lender is Best For You
Side-by-side comparisons may help you save money. Reverse Mortgage counselors will be able to provide this information if you have questions.
Know the TALC Rates
Clearly understand what requirements need to be followed to prevent the reverse mortgage loan from becoming due. Counselors and Lenders will be able to explain the Total Annual Loan Costs (TALC) that show the estimated annual cost of the loan.
Understand Your Loan Options
If you are planning to use the proceeds from your reverse mortgage loan for home repairs or improvements, contact your local Area Agency on Aging to see if you may qualify for loans for home repairs or help paying property taxes. Visit www.eldercare.gov for more information at Area Agencies on Aging.