REVERSE MORTGAGE GUIDE


Everything you need to know about this revolutionary reverse mortgage product

What is an Equity Elite
Reverse Mortgage?

 

Many older homeowners and homebuyers use reverse mortgages as a financial tool to tap into the equity in their homes to gain more financial flexibility. 

Because Home Equity Conversion Mortgages (HECMs) have certain limitations, the innovators at Reverse Mortgage Funding LLC (RMF) created and launched Equity Elite reverse mortgage. Specifically designed for those age 60 and older, it is a low-cost reverse mortgage option that allows borrowers to potentially tap into more funds than is possible with a HECM. As with any mortgage, you must meet your loan obligations, keeping current with property taxes, insurance, and maintenance.

At a minimum, to be eligible you must be 60† years of age or older; you must have a certain percentage of equity in the home; and the house must be your principal residence.

 

Why Equity Elite?

 

Equity Elite offers many benefits that are not found with a HECM or traditional reverse mortgage.  It has potentially lower up-front costs, including one option that eliminates nearly all up-front costs1, and allows for loan amounts of up to $4 million, depending on home value.  Plus more condo homeowners and homebuyers can qualify.

A reverse mortgage is a great way to access your home's equity to supplement your income, establish a "rainy day fund" or meet a variety of other financial goals. And with its flexible repayment option, it offers homeowners greater control over their finances. As with any home-secured loan (or mortgage), you must meet your loan obligations, keep current with property taxes, insurance, and maintenance. But how do you know if you are eligible for an Equity Elite reverse mortgage?

 

 



ELIGIBILITY CALCULATOR


If you are 60 and older
with at least 50% in home equity,
complete the form below!

By clicking "CALCULATE ELIGIBILITY", you are providing your signature and express "written" consent to be contacted by or behalf of Reverse Mortgage Funding LLC, its affiliates and/or its agents (collectively Company) at the telephone, email or mailing address that you have provided for purposes of fulfilling this inquiry about reverse mortgages and/or the Company's products or services, even if you have previously registered on a "do not call" government registry or requested Company to not send marketing information to you by email and/or direct mail. You agree that the Company may use automatic telephone dialing systems and prerecorded voice messaging in connection with calls or texts made to the telephone number you provide even if the telephone number is assigned to a cellular or mobile telephone service or other service for which the called party is charged. You understand that you are not required to consent to receiving autodialed calls or texts as a condition of any reverse mortgage and/or purchasing any Company products or services. If you do not wish to authorize Company to contact you in this manner, you can call 888-277-4496 to complete your request. You understand that you can revoke this consent at any time.

How much can you receive?



The amount that is available generally depends on four factors: your age, the current interest rate, the appraised value of the home, and lending limits1.


Equity Elite has some powerful advantages



Equity Elite has certain advantages over other types of home equity-based loans, such as:

  • Available to borrowers 60† years of age and older
  • Higher home values can access more equity
  • A maximum loan amount of up to $4 million dollars
  • More condos can qualify
  • Equity Elite Zero eliminates nearly all closing costs2  
  • Lower up-front costs
  • Retire more freely! 


 

 

How Does Equity Elite Work?

 

An Equity Elite reverse mortgage is a powerful financial tool that allows you to turn some of the equity in your home into funds you can use as you choose. Like a traditional mortgage, a reverse mortgage is a home-secured loan; but unlike a traditional mortgage it is specifically designed for homeowners age 60 and older. The process to obtain an Equity Elite reverse mortgage is simple; but it’s helpful to know what you can expect. Here’s a reverse mortgage roadmap to help you along the way.

 

 

STEP 1: PREPARATION

The road to your reverse mortgage starts with education. You may have heard a lot from friends and family or even from television about what reverse mortgages are, but it's important to weigh all the pros and cons for yourself. An experienced loan specialist like the professionals at Reverse Mortgage Funding LLC (RMF) can provide you with the information you need to help you decide if a reverse mortgage solution is the right choice for you.

STEP 2: ON THE ROAD

If you decide to move forward, you'll choose a lender and submit your application to them. The application includes some personal information, and a financial assessment will be conducted to make sure you'll be able to afford ongoing expenses like property taxes, insurance and home maintenance.

You'll meet with an independent reverse mortgage counselor who's approved by the U.S. Department of Housing and Urban Development (HUD)1, to make sure you understand all aspects of the loan.

STEP 3: ROUNDING THE BEND

Your home will be appraised by an independent appraiser, to determine the value. Then the appraisal and loan package will be sent to an underwriter for review and approval. The underwriter will make sure all the information in the package is correct, complete, and compliant with all applicable laws and regulations.

STEP 4: ALMOST THERE

After your loan application is approved, you will sign your closing documents with a title officer or attorney (depending on your state's requirements).

STEP 5: ARRIVAL

Three days after closing, the loan funds are disbursed and you can access them according to the payment plan you selected. Your loan funds will first be used to pay off any existing mortgage on your home, a new lien (the reverse mortgage) is placed on the home, and you can use the remaining funds from your reverse mortgage however you choose.

What our customers have to say




 

PROS of an Equity Elite Reverse Mortgage

  • Since there is no mortgage insurance premium, Equity Elite has lower up-front costs than a traditional reverse mortgage.
  • You can potentially access even more equity—maximum loan amount is up to $4 million.
  • Unlike traditional reverse mortgages, it’s available to owners and buyers of non-FHA-approved1 condos
  • Equity Elite ZEROhas the benefits of Equity Elite, but eliminates almost ALL closing costs, and has potentially lower interest rates.
  • It’s a loan option that can help make it easier for homeowners and homebuyers age 60 and older to live a more comfortable retirement.
  • You continue to live in your home and retain title to it. As with any mortgage, you must meet your loan obligations, keep current with property taxes, insurance, and maintenance. 
  • The funds from your reverse mortgage loan can be used to pay off the existing mortgage on your home. While there will still be a lien on your home for the outstanding amount of the reverse mortgage, you are not required to make monthly principal and interest payments on the reverse mortgage, so you will be freed from the monthly mortgage payment expense. As with any mortgage, you must meet your loan obligations, keep current with property taxes, insurance and maintenance. 
  • No monthly mortgage payments are required for as long as you live in the home and continue to meet your obligations to pay your property taxes and homeowners insurance and maintain the property. As with any mortgage, you must meet your loan obligations, keep current with property taxes, insurance and maintenance.  
  • Loan proceeds are generally not considered taxable income. (Not tax advice; consult a tax professional.)
  • Generally, a reverse mortgage loan will not affect Social Security or Medicare benefits. However, you may wish to consult a financial professional to determine the potential financial implications of obtaining a reverse mortgage loan. The funds from a reverse mortgage generally do not affect regular Social Security. However, needs-based benefits, such as Supplemental Security Income (SSI), may be impacted. Consult a financial professional or government benefits specialist about your particular situation. Visit www.ssa.gov.
  • A reverse mortgage loan is a non-recourse loan. This means that neither you nor your heirs are personally liable for any amount of the mortgage that exceeds the value of your home when the loan is repaid.
  • If your home increases in value in the future, you may consider refinancing your reverse mortgage to access even more loan proceeds.
  • After the loan is repaid, any remaining equity belongs to you or your heirs.

If you’re a homeowner who’s at least 60 years old, with equity in your home, you may be eligible for this financial solution.

CHECK ELIGIBILITY

CONS of Equity Elite Reverse Mortgage

  • The loan balance increases over time as interest on the loan and fees accumulate.
  • As home equity is used, fewer assets are available to leave to your heirs. You can still leave the home to your heirs, but they will have to repay the loan balance. Usually, the loan is paid off by selling the home. However, this can be done using other funds or by refinancing through a traditional mortgage.
  • Fees may be higher than with a traditional mortgage. (Ask us about our lower-cost options.)
  • Eligibility for needs-based government programs, such as Medicaid or Supplemental Security Income (SSI), may be affected. Consult a benefits specialist.
  • A reverse mortgage loan becomes due and must be repaid when a “maturity event” occurs, such as the last surviving borrower (or, in the case of a HECM, non-borrowing spouse meeting certain conditions) passes away, the home is no longer the borrower’s principal residence. The loan will also become due if the homeowner fails to meet other loan obligations, which include paying their property taxes, insurance, and maintaining the property.

PERSONAL REQUIREMENTS

  • All borrowers on the home’s title must be at least 60 years old.
  • You must live in your home as your primary residence for the life of the reverse mortgage. Vacation homes or rental properties are not eligible.
  • You must own your home outright or have at least 50% equity in your home. Even if you owe some money on your existing mortgage, you may be eligible for an Equity Elite reverse mortgage. The funds from the reverse mortgage would first pay off your mortgage and satisfy any other eligible existing liens before you could use the funds for other things. Refinancing existing debt(s) with a reverse mortgage can help improve monthly cash flow.
  • You must meet with an approved Equity Elite reverse mortgage counselor. The reverse mortgage counselor will discuss how a reverse mortgage works and the associated costs. The goal of the counseling session is to make sure that potential borrowers fully understand and are comfortable with the process and the loan terms.

 

EQUITY ELITE PROPERTY REQUIREMENTS

  • Single-family homes, or 2-to-4 unit properties with one unit occupied by you
  • Manufactured homes (built after June 1976) that meet HUD requirements
  • Condominiums that are FHA-approved1, Fannie Mae-approved or RMF-approved
  • Townhouses

FINANCIAL REQUIREMENTS

  • You must show the financial ability and willingness to meet your loan obligations, which include paying property-related taxes and insurance, and keeping up with regular home maintenance and repairs.

SEE WHAT YOU ARE ELIGIBLE FOR

CHECK ELIGIBILITY

Not applicable in all states; some states may impose a higher age requirement. Visit www.reversefunding.com/equity-elite for details.

1This material has not been reviewed, approved or issued by HUD, FHA or any government agency. The company is not affiliated with or acting on behalf of or at the direction of HUD/FHA or any other government agency.

2With this pricing option, borrower receives a lender credit covering nearly all closing costs.There is a non-refundable independent counseling fee of approximately $125 on average, which the borrower pays directly to the counseling agency.Terms and conditions apply. Not available in all states.

Equity Elite Reverse Mortgage (“Equity Elite”) is Reverse Mortgage Funding LLC’s proprietary loan program, and it is not affiliated with the Home Equity Conversion Mortgage (HECM) loan program, which is insured by FHA. Equity Elite is available to qualified borrowers who also may be eligible for FHA’s HECM program or are seeking loan proceeds that are higher than FHA’s HECM program limit. Equity Elite currently is available only for eligible properties in select states. Please contact your loan originator to see if it is currently available in your state. 

Upon a maturity event, any non-borrowing individuals with an ownership interest in the property, including non-borrowing spouses, will have a short period of time (for example, 30 days from a due and payable letter or an alternate time specified by the loan servicer if extensions are available under the circumstances) days to purchase the property from the estate or, if the non-borrower inherits the property, pay the loan in full using any sources of funds available to them. Any non-borrowing individual, including a non-borrowing spouse, should have a plan to pay off an Equity Elite reverse mortgage upon the borrower’s death or any other maturity event. If the non-borrower is unwilling or unable to purchase the property or pay the loan in full, there is no protection for the non-borrower (including a non-borrower spouse) to maintain an interest in the home or to continue residing in the home past the maturity event and the non-borrower may be evicted upon foreclosure. The FHA HECM program has protections in place for certain non-borrowing parties, so a reverse mortgage applicant with certain non-borrowing parties should strongly consider a FHA-insured HECM loan (see HECM guidelines or ask an RMF representative for details).  Under the Equity Elite reverse mortgage loan program, a maturity and/or default event occurs when the last surviving borrower no longer lives in the home as his or her primary residence for at least 12 months, the property charges (including taxes, insurance, or any other property charges) are not paid, required repairs are not completed or the property is not maintained, or any other maturity event, as specified in the Security Instrument, occurs.

 
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