Reverse Mortgage Answers for Senior Homeowners
The questions below are some of the most common questions our experts hear when they meet with a homeowner considering a reverse mortgage.
If you are over the age of 62 and own your own home, a reverse mortgage might be the perfect solution. You can use the equity you've accumulated in your home over the years to improve your quality of life and ease any financial concerns you might have.
One of the major differences is a reverse mortgage does not require a monthly payment. To qualify for a traditional mortgage or a home equity line of credit, you must have sufficient income and acceptable credit to be approved for the loan. Your eligibility is based upon your age. The loan amount you qualify for must be sufficient to satisfy any existing loans secured against your home.
You are required to pay your property taxes and homeowners insurance.
Yes, but any existing mortgages must be paid off at closing. The proceeds from the reverse mortgage may be used for that purpose first.
The amount you may qualify for depends upon the product, your age, the current interest rate, appraised value of your home and FHA's mortgage limit for your area (if applicable).
You will pay many of the same fees as if you were buying a home. All of the costs may be financed.
The loan is satisfied when the last borrower passes away, the property is sold or is no longer the borrowers primary residence.
All reverse mortgages are non-recourse loans, which means that you can never owe more than what your home is worth regardless of the loan balance.
No, refinancing or other assets can accomplish repayment.
No, nor is the loan due. You are not required to repay the loan as long as one of the borrowers remains in the property and pays the taxes and insurance.
Yes, there are approximately three different reverse mortgage products available.
Yes, and your closing costs may be dramatically reduced.
Yes, the title to your property may remain as is. However, the trust does have to be reviewed to ensure you are the beneficiary of the trust and the trust is irrevocable.
Currently the Internal Revenue Service does not consider proceeds from a reverse mortgage taxable income.**This is not tax advice, please consult a tax professional.
The interest accrues and is only deductible when the reverse mortgage loan balance is paid in full.
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NMLS #414726; Member FDIC; All loans subject to credit approval. Qualified applicant must be at or below 80% of area median income. Borrower(s) must be first-time homebuyers or have no current ownership in any other real estate. Owner-occupied primary residences only. Additional restrictions apply for 2-family residences. *Washington Trust will match up to 1.5% of a 3% downpayment as a non-repaid grant. **Washington Trust will waive the standard underwriting and processing fees.