To choose another state please click on the go back link at the top of. In 1989, the federal housing administration fha created the home equity conversion mortgage hecm program. The fha maintains a list of legitimate reverse mortgage. The only reverse mortgage insured by the us federal government is called a home equity conversion mortgage. The amount of down payment depends on how old the home buyer is. There are a number of things to consider when deciding if a reverse mortgage is the right choice for you. In 1989, the department of housing and urban development introduced the agencys first reverse mortgage. Sun west offers residential home loan mortgages such as purchase, refinance, property rehabilitation loan, and reverse mortgage.
You can search online for a fhaapproved lender or you can ask the hecm counselor. The fha reverse mortgage is designed for helping people sixtytwo years old or older. Department of housing and urban development hud urge vigilance when looking at reverse mortgage products. Reverse mortgages, a discussion guide consumer financial. Additionally, this document references other hud handbooks and industry websites that offer participants resources to assist with the implementation of their housing counseling initiatives. The housing and community development act of 1987 p. Announces longawaited changes that will make it easier for condo owners to obtain a hecm. You can search to find counseling agencies in various parts of the country. The hecm protocol is also provided as an appendix to this handbook to offer additional guidance on reverse mortgage counseling. Reverse mortgages allow older homeowners to convert a portion of their home.
Huds reverse mortgage insurance program congressional research service summary reverse mortgages allow older homeowners to borrow against the equity in their homes and repay the loans at a later time, after they sell the home or pass away. Need to be at least 62 years old and meet hud fha reverse mortgage guidelines as well as all hud 4000. Hud reverse mortgage handbook best home equity loans of. Hud reverse mortgage handbook it is recommended for financing major oneoff expenses, including home renovations or repairs, medical bills, repayment of credit card debt, or. An fha reverse mortgage is designed for homeowners age 62 and older. The mortgage insurance guarantees that you will receive expected loan advances. Fha loan guidelines require the borrower to have already paid off the home or owe very little. Hud s home equity conversion mortgage hecm, fannie maes home keeper mortgage.
The specific changes to the fha appraisal protocols include that in terms of reverse mortgages, most hecm for purchase transactions will now be able to utilize either the exterioronly or. Reverse mortgage basics fha insured reverse mortgages. It allows the borrower to convert equity in the home into income or a line of credit. Hud manages the hecm program and provides guidance through mortgagee letters, faqs, handbooks and regulations. The fha reverse mortgage loan is also known as a home equity conversion mortgage. This handbook provides updated instructions to approved mortgagees and to hud field office personnel regarding the processing and servicing of a home.
Hud issues new reverse mortgage servicing guidance. Thats why in order to qualify for an fha hecm loan, participation in hud approved housing counseling is required. This handbook provides updated instructions to approved mortgagees and to hud field office personnel regarding the processing and servicing of. The mortgagee letters listed on this page update the policies in hud handbook 4235. Hud public affairs specialist brian sullivan told reverse mortgage daily, based upon data we gave them, they put two and two together and get something other than four. Counseling agencies that specialize in reverse mortgage counseling are eligible for hud approval as long as hud handbook. Fha reverse mortgage appraisal guidelines home guides.
Federal housing administration fha approved lenders are now eligible. Home equity conversion mortgages handbook hud exchange. If hud has insured a reverse mortgage, there should be a home equity conversion second mortgage that is recorded after the reverse mortgage. Department of housing and urban development, handbook 4235. Among its many insurance programs, the federal housing administration offers a reverse mortgage known as the home equity conversion mortgage. A detailed discussion with a counselor will give you important information to help you decide. Home buyers can also purchase a home with hud fha reverse mortgages. Ahead of the impending rollout of the home equity conversion mortgage final rule on september 19, the department of housing and urban development provided updated servicing. The equity that the homeowner builds up over years of making mortgage. The amount owed must be paid off with part of the proceeds from the fha reverse mortgage. Irrevocable trusts and the reverse mortgage opportunity.
These products are insured by the federal housing administration and regulated by the u. Fha guidelines for an appraisal for a reverse mortgage. Hud fha reverse mortgages guidelines and lending requirements. Mortgage fha loosens condo eligibility requirements for reverse mortgages. Architectural processing and inspections for home mortgage insurance superseded in part by hud handbook 4000. Hecm allows senior citizens to access their paidoff. Reverse mortgages let you cash in on the equity in your home. Reverse mortgages are increasing in popularity with seniors who have equity in their homes and want to supplement their income. The reverse mortgage handbook provides detailed information to assist in a comprehensive understanding of three popular reverse mortgage products.
Specifications on time extensions are provided by hud in its handbook. If you meet the eligibility criteria, you can complete a reverse mortgage application by contacting a fhaapproved lender. Fha loosens condo eligibility requirements for reverse. There are no monthly principal and interest payments. Development hud approved reverse mortgage counselor today. You can narrow your search within this state by using one or more of the following search criteria and clicking the search button. Fha relaxes appraisal, documentation requirements during. Federal government is called a home equity conversion mortgage. Hud s home equity conversion mortgage fannie maes home keeper mortgage.
This handbook describes the departments home equity conversion mortgage hecm program and provides instructions for hud staff, participating lenders, and hudapproved counseling agencies. A reverse mortgage enables you to withdraw a portion of your homes equity to supplement your income, or to purchase a home. Reverse mortgages allow homeowners to convert equity in their homes into income that can be used to pay for home improvements, medical costs, living expenses, or other expenses. The handbook also has guidelines for other mortgage items such as fha refinance loans, and fha reverse mortgages. Reverse mortgages themselves are not a scam, but there are unscrupulous people and companies that sometimes use reverse mortgages to exploit consumers. Home program offices chief human capital officer hudclips handbooks housing handbooks home equity conversion mortgages 4235. Counseling of potential reverse mortgage counseling clients nonborrower spouse september 9, 20. Welcome to fha s search for counseling agencies by location or name. Fha single family housing policy handbook table of contents handbook 4000. Because a reverse mortgage is a negative amortized loan, the loan balance grows over time. Mortgage insurance premium rates and principal limit factors. Hud reverse mortgage guidelines forbid lenders to ever charge more than the value of the home when it comes time to pay off the loan.
The second mortgage will be for the same amount as the first home equity conversion mortgage. The reverse mortgage handbook provides detailed information and examples to assist in a comprehensive understanding of three popular reverse mortgage products. What happens to a reverse mortgage after the borrowers death. The federal housing administration has helped families obtain sustainable mortgages since its inception in 1934. If you meet the eligibility criteria, you can complete a reverse mortgage application by contacting a fha approved lender. This handbook provides updated instructions to approved mortgagees and to hud. A guide for advocates national consumer law center. For example, if your search is for a list of all active. The sf handbook has the rules for fha loans, such as forward mortgages, for borrowers who wish to buy a house, condo, townhome, manufactured home, etc. Hecm is a safer, federally insured version of the traditional reverse mortgage. Fha approved reverse mortgage lenders and conflictsofinterest behavior with hud. Specifically, the housing counseling handbook outlines requirements for program eligibility and approval, the delivery of comprehensive and home equity conversion mortgage hecm counseling services.
132 872 842 892 564 1367 401 1359 1258 859 379 1573 1580 111 887 633 484 1622 215 870 312 30 829 281 363 53 987 1437 725 1275 617 838 692 566 788 206