Call now for information about a reverse mortgage line of credit

Call now for information about a reverse mortgage line of credit

We asked people to compare.

In a blind test, most people chose a Reverse Mortgage Line of Credit over a traditional Home Equity Line of Credit (HELOC). It offers many of the same benefits of a HELOC— as well as some important advantages.

Watch the video to learn more about a Reverse Mortgage Line of Credit.

Home Equity Line Of Credit (HELOC)
Reverse Mortgage Line of Credit

Home Equity Line Of Credit Challenge

  • Traditional Home Equity Line of Credit
  • Monthly payments required

  • 10-year mandatory payback deadline

  • Lender can reduce the amount of money available to you
  • If your home loses value, you're still responsible to pay the full loan balance
  • Not FHA insured
  • No independent counseling provided
  • Reverse Mortgage Line of Credit
  • You choose how and when to pay, or defer payments ¹
  • No mandatory payback deadline, as long as you meet your loan obligations
  • Lender cannot reduce the funds available to you; in fact they can grow over time ²
  • You can never owe more than the home is worth when the loan is repaid
  • FHA-insured loan*
  • Independent, HUD-approved counseling

Both a Traditional Home Equity Line of Credit and a Reverse Mortgage Line of Credit require the borrower to meet all of the terms of loan.

¹ As with any home-secured loan, a consumer with a reverse mortgage must continue to meet his/her loan obligations, pay property taxes, homeowners insurance, and any homeowners association (HOA) fees and cost associated with home maintenance.

² If part of your loan is held in a line of credit upon which you may draw, then the unused portion of the line of credit will grow in size each month. The growth rate is equal to the sum of the interest rate plus the annual mortgage insurance premium rate being charged on your loan.

How a Reverse Mortgage Line of Credit grows

The unused portion of a Reverse Mortgage Line of Credit grows at a rate equal to the loan’s current interest rate plus 1.25%—independent of home value.

How a Reverse Mortgage Line of Credit grows

The information being shown is for illustrative purposes only. Scenario is a 62-year-old couple, with a home valued at $450,000 and no mortgage, securing a reverse mortgage line of credit (LOC). LOC will grow at 4.50% above the 1-year LIBOR (margin = 3.25% + ongoing Mortgage Insurance Premium of 1.25% = 4.50%). The initial LOC is $228,139.85; left unused, in 10 years, when they are 72 years old, LOC will have grown to $426,590.21 in available funds. In 20 years, at age 82, assuming no withdrawals the amount available will be $797,272.25. The estimates shown are based on a CA property and Reverse Mortgage Funding LLC’s HECM Annual ARM as of 03/06/2017. The initial Annual Percentage Rate is 4.433%. The loan has a variable rate. The rate is tied to the 1-year LIBOR plus a margin of 2.625%. There is a 5% lifetime interest cap. This means that the maximum rate that could be imposed is 9.433%. In this example, closing costs include an origination fee of $2,250, third-party closings costs of $2,437.45, and an up-front FHA Mortgage Insurance Premium of $2,250 depending on the appraised value of the property securing the loan. Interest rates and funds available may change daily without notice. L867-Exp032018


Check your eligibility and receive a quote now:

By clicking "GENERATE INSTANT QUOTE", 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 888-277-1567 to complete your request. You understand that you can revoke this consent at any time.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.


Chat with us