How a Reverse Mortgage for Home Purchase Works | ARLO™

July 3, 2021     60 comments

Reading time: 5 min Did you know that a reverse mortgage can be used to purchase a new home? It sure can, in a process called a Home Equity Conversion Mortgage Purchase. (HECM Purchase) Basically, a new home is bought at the same time a reverse mortgage is taken, and the transaction is rolled into one. The reverse mortgage for home purchase is an option for seniors who want to relocate, either to be closer to family, to downsize, or move to a home that better meets their needs—without... Read Full Article

Should You Sell Your Home or Take a Reverse Mortgage?

July 2, 2021     no comments

When facing the decision to take out a reverse mortgage or sell your home, there are a few factors to weigh. Each option has its own pros and cons and can vary depending on your particular situation. Pros & Cons of Selling Your Home Perhaps the most important thing to consider is your ultimate goal for your future living situation, whether you’re looking to downsize, relocate, or rent. PRO: Ability to downsize If you’re looking to downsize or move into a place that’s more suited for your lifestyle, then selling... Read Full Article

What Happens When You Inherit a Reverse Mortgaged Home?

July 1, 2021     4 comments

Hi ARLO, my mom passed away, I have inherited her home with a reverse mortgage on it. Can I still try and refinance the loan or home, or do I have to get a home loan myself? The reverse mortgage becomes due and payable when the last borrower on the loan is no longer living in the property.  If mom was the last borrower, when she passed the loan became due and payable which gives you several options. I assume from your question that you would like to stay in... Read Full Article

How to Qualify for a Reverse Mortgage Loan in 2021

July 1, 2021     6 comments

You may be interested in applying for a reverse mortgage, but like any loan, there are certain qualifications you will have to meet. And because most reverse mortgages are insured by the Federal Housing Administration, there are many aspects in terms of your finances and home condition that need to meet government standards for this to happen. There are some more obvious reasons why someone may not qualify for a reverse mortgage, such as not meeting the minimum age requirement of 62 or simply not having enough home equity. But there... Read Full Article

How a Reverse Mortgage Can Protect Your Assets from Inflation

July 1, 2021     no comments

The troubled economy, pandemics and social unrest have made the idea of retirement very uncertain for many seniors who are now struggling to come up with ways to securely finance their futures. What most senior homeowners don’t realize is that getting a line of credit through a reverse mortgage can help them preserve their equity from inflation, as it will allow them to lock in on historically low interest rates and current home values which have grown tremendously in recent years, and increase the amount of loan funds available to... Read Full Article

How to Purchase a Home That Has a Reverse Mortgage

June 30, 2021     30 comments

We are looking to buy a home, and signed a contract for sale for $730,000. The house appraised for just over that amount. Afterwards, we learned that the seller owes more than that ($760,000) on a reverse mortgage. Does HUD/FHA need to approve the sales price before we can close? It seems that because the sales price is within 95% of the amount owed, the seller would be able to complete the transaction. Does HUD/the lender get to keep the difference between what is owed and what the sales price... Read Full Article

Did You Know? Reverse Mortgages Allow Interest Repayments

June 30, 2021     12 comments

You may think you understand reverse mortgages—and you probably do. They are, simply put, a type of mortgage that allows you to receive payments from your home equity rather than make a monthly payment to repay the obligation. They are, simply put, a type of mortgage that allows you to receive payments from your home equity rather than make a monthly payment to repay the obligation. But there are some benefits that borrowers might not consider initially, that give reverse mortgages some outside-the-box applications that could help you improve your... Read Full Article

Reverse Mortgage Age Limits & Title Cautions

June 29, 2021     48 comments

The HUD HECM program limits the youngest borrower to the age of 62 or older to be eligible for the reverse mortgage program. If there is a spouse of a borrower who is not yet 62, the older spouse can still get a reverse mortgage and the younger spouse can remain on title and would be known as an “eligible non-borrowing spouse.” Eligible Non-Borrowing Spouses An eligible non-borrowing spouse can also live in the home for life, even if the older spouse passes or should have to leave the... Read Full Article

How to Sell Your Home if You Have a Reverse Mortgage Loan

June 29, 2021     94 comments

Is it true that if an inheritor or owner of a reverse mortgage decides to sell the home, and asks less than the amount of the loan, that the reverse mortgage company holding the note cannot request more than the amount the seller asked? You have asked a question that covers distinctly different scenarios and the answer to each scenario differs based on the circumstances. If a borrower passes and the home goes to heirs, the lender will also order an appraisal and if the property is worth less... Read Full Article

Reverse Mortgage Payment Options: Lump Sum vs Line of Credit

June 29, 2021     10 comments

If I do a reverse mortgage, can I pull all the money up front as a lump sum or do I have to have a line of credit, and is there cost to pulling out all the money up front? HUD changed the program a little while back so that borrowers are capped at what they can pull from the home based on the amount of what HUD calls the property charges that must be paid at the time of the loan. The bottom line is that borrowers who... Read Full Article