Reverse mortgage scams

The minimum you can borrow varies, but is typically about $10,000. Your decision could affect your partner, family and anyone you live with. So take your time to talk it through, get independent advice and make sure you understand what you're signing up for.

Any event that would trigger a foreclosure of your reverse mortgage must be stated in your loan documents and as part of the disclosure provided to you by your lender before you close your loan. In addition, [3 nycrr part 79.7 requires the lender to provide you with written notification of the occurrence of an event that would trigger termination of your reverse mortgage loan. Additional information on the foreclosure triggers for a hecm loan are available by visiting the website for the department of housing and urban development or its hecm website. The most important distinction between a hecm and proprietary reverse mortgage concerns the maximum loan amount available under each type of loan. Proprietary reverse mortgages, on the other hand, do not have a cap. It is for this reason that they are often referred to as “jumbo” reverse mortgages.

Make sure you understand how a reverse mortgage works and how it can affect your home equity over time. VA Loans The amount of time that you or your estate has to repay a reverse mortgage may vary. For example, if you die then your estate may have 180 days to pay back the mortgage. However, if you move into long-term care, then you might have one year to pay it back. Make sure you ask your lender for information about the timing for paying back a reverse mortgage.

The borrower is not required to pay back the loan until the home is sold or otherwise vacated. As long as the borrower lives in the home he or she is not required to make any monthly payments towards the loan balance. The borrower must remain current on property taxes, homeowners insurance and homeowners association dues . The loan is called a reverse mortgage because instead of making monthly payments to a lender, as with a traditional mortgage, the lender makes payments to the borrower. If you do not live in the home for more than 6 months, the loan could come due.

You may wish to leave your home to your children or other relatives after you pass away. A reverse mortgage can make this difficult because you accept a lien on your home. In other words, the bank has the first claim on your property once you’re gone from the home. As mentioned before, you do have the option of making regular payments to your loan, but repayment isn't required until you sell the home, no longer live there or pass away.