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You Can Get Money For Your House And Live In It, Too

Posted: 7/6/2011

Many older homeowners who have been looking for hard-to-find home equity loans are now turning to reverse mortgages instead.

(NAPSI)—A retirement free of mortgage payments may be possible for many with an increasingly popular loan program known as a reverse mortgage. It can provide homeowners with cash while eliminating their house payments.

Reverse mortgages offer those 62 and older the ability to convert the equity in their home into cash while eliminating monthly mortgage payments. You can think of it as a home equity loan that doesn’t require monthly payments. What’s more, the program is insured by the federal government and the homeowner keeps full ownership of the house.

Now the options for reverse mortgages are growing. A new program, the Home Equity Conversion Mortgage (HECM) Saver, offers significantly lower fees than a standard reverse mortgage, making it much more affordable.

“The HECM Saver has become very popular with many retirees looking for an affordable reverse mortgage product that allows them to eliminate their monthly mortgage payment—oftentimes a person’s single largest monthly expense,” said Jay Farner, CEO of One Reverse Mortgage.

“Not only are people able to eliminate a payment but they are often able to convert some of the equity in their home into tax-free cash,” Farner added.

While the HECM Saver offers a significant reduction in up-front fees, it also limits the amount of equity a homeowner can draw from the house. For some, that makes a standard reverse mortgage more attractive.

For instance, on most traditional HECM reverse mortgages, the mortgage insurance fee is two points, which would come to $5,000 on a $250,000 home. Those fees are reduced to only $25 through the HECM Saver program.

Another great benefit of all reverse mortgages is that credit scores play no role in determining eligibility. This may be a blessing for many who are struggling in today’s economy or have been plagued with piling medical bills.

“The real story here is that reverse mortgages are not only growing in popularity, they are also offering more choices to consumers,” Farner added. “They may not be right for everyone, but a reverse mortgage can be a fantastic supplement to a retiree’s 401(k) and other investments.”

Learn More

To learn more about reverse mortgages, you can visit the National Reverse Mortgage Lenders Association at www.nrmlaonline.org or One Reverse Mortgage at www.onereversemortgage. com or call (800) 401-8114.

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