| FEATURES | BENEFITS |
| No more monthly home loan re-payments of any kind | What this means to you:
For as long as one owner occupies the home as their primary residence, they will never have to make any mortgage payments again. |
| All other mortgages and/or liens are paid in full at closing | What this means to you:
No longer having any monthly mortgage or home equity loan payments to make will not only will increase your monthly cash flow, but it also means there is no future risk of foreclosure for failure to make those monthly mortgage payments. |
| All cash advances from your reverse mortgage are TAX FREE | What this means to you:
The Freedomn Bar Association guide states that generally, "the IRS does not consider loan advances to be income", and a reverse mortgage is a loan against the primary residence. However, you should consult a tax advisor for more information about your specific situation. |
| Credit Line Growth is approximately 0.5% per year over the current interest rate | What this means to you:
HECM borrowers may elect to access some or all of their tax-free money via a credit line. Lines of credit are given a "growth rate". The rationale is that over time, homes appreciate. The growth rate is simply an increase in the equity available. However, if the home does NOT appreciate, the line of credit still is granted the growth rate. This is one of the best features of a HECM. As a result, there may be a large increase in the available credit line over time. |
| There are numerous Cash Advance Options, and YOU decide how you will receive the loan proceeds | What this means to you:
You may choose from four options including a line of credit, monthly cash advances, a lump sum, or a combination of the above payment methods. |
| Loan balances do not have to be re-paid until the last owner moves, sells, or passes | What this means to you:
Repayment is only required after any of the folllowing the maturity events: death, property sale, relocation, or if there is a failure of the owners to pay property taxes or hazard insurance, properly maintain the property, or violate any of the loan terms. |
| By law, a HECM Reverse Mortgage is "non recourse" | What this means to you:
The lender is paid only from the sales proceeds, and the lender can only look to the home value and selling price to pay off the loan. The lender may not seek repayment from any other assets of the borrower's their estate or heirs even if the sales proceeds do not pay off the loan in full. |
| Counseling with a HUD approved Counselor is required | What this means to you:
Before applying for a HECM reverse mortgage, all homeowners listed on the Title must complete a 30-45 minute telephone interview with a HUD approved counselor. This consumer protection allows you to ask questions, confirm the features and benefits, and help homeowners determine if a reverse mortgage is right for their specific situation. |
