Reverse Mortgage Fact Sheet
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Envoy Mortgage has the distinction of being the nation's First Mortgage Partnership provider of the reverse mortgage and offers the program through 30 regional offices in 50 states across the nation. In addition to offering the Fannie Mae Home Keeper and FHA Home Equity Conversion Mortgage reverse mortgages, we offer the only private reverse mortgage in the U.S. for higher valued homes. We have been offering these loans to senior homeowners since 1991 and have to date helped more than 50,000 homeowners enjoy the benefits of a reverse mortgage.
We would be happy to review our programs with you and help you decide which reverse mortgage program will best fit your needs.
Key facts and details of our reverse mortgage programs are summarized below:
1. Definition: A reverse mortgage is a unique financial tool that enables homeowners ages 62 and over to tap into their home's equity, receiving either a monthly income, lump sum of cash or a line of credit. There are no income or credit qualifications and there is no repayment until the homeowner permanently leaves the home. The borrower retains full ownership of the property.
2. Qualifications: Applicant(s) must be at least 62 years of age and must own their home free and clear or nearly free and clear â€" in many cases borrowers use the reverse mortgage to pay off existing liens or mortgages, which eliminates their monthly loan payments. Borrowers must also live in their home as their primary residence which means that they should not live elsewhere for more than 365 consecutive days.
Mobile homes have specific requirements that must be met in order to be eligible for reverse mortgages. Please contact us for a list of these requirements. Commercial properties are currently ineligible for reverse mortgages.
3. Determination of Loan Amount: The loan amount is based on the home value, the number and age of the homeowner(s), the current interest rate and the maximum allowable home value.
The maximum allowable home value varies depending on the reverse mortgage program selected. The FHA-Insured Reverse Mortgage Program has limits, called Maximum Claim Amounts, ranging from $172,632 to $362,790. This amount varies by country. The Fannie Mae Home Keeper program has a nationwide limit of $417,000.
4. Counseling: All borrowers are required to receive free counseling from a third-
party counseling agency prior to applying for a reverse mortgage. Your local Senior Loan Advisor has a list of counselors in your area and can refer you to the reverse mortgage counselor nearest you. The counselors often will be willing to do the counseling session over the telephone if you are unable to go to their office.
5. Payment Plans: Reverse mortgage borrowers can choose from several payment plan options:
a. Tenure: Borrower receives a monthly check for as long as they live in the home.
b. Line of Credit: Borrower can draw up to a maximum amount at the
times and in the amounts of the borrower's choosing.
c. Lump Sum Cash Advance: A lump sum of cash distributed to borrower
d. Modified Tenure: Any combination of the above options.
6. Processing Times: On average it takes 6-8 weeks to process a reverse mortgage.
7. Closing Costs: Closing costs are financed into the loan, and include the appraisal, title insurance, origination fee and recording fees. Your local Senior Loan Advisor will be happy to provide you with a Good Faith Estimate of Closing Costs when they meet with you.
8. Interest Rate: The interest rate charged varies depending on the reverse mortgage program selected by the borrowers. All programs offer adjustable rates, and have lifetime caps on the maximum allowable rate. Please call your local Senior Loan Advisor for a quote on the current rates.
9. Impact on Income Taxes and Social Security: Proceeds from a reverse mortgage are considered to be a loan, not income. Therefore, the funds received are not subject to income tax and do not affect Social Security Benefits. Borrowers receiving Medicaid or SSI may not be affected if the funds from the reverse mortgage are spent in the month they are received. As always, we recommend you consult your tax advisor for further details.
10. Repayment: The reverse mortgage becomes due and payable at the time the borrower permanently leaves the home. The reverse mortgage can be repaid either from the proceeds of the sale of the property; other liquid assets or the heirs can obtain a conventional mortgage to pay off the reverse mortgage.
The loan balance consists of the financed closing costs, the cash that was advanced to the borrower and any interest that accrued. Remaining equity belongs to the borrower of their heirs. The reverse mortgage is subject to a non-recourse limit, which states that the borrower or their heirs are only required to repay the loan balance or the fair market value of the home, whichever is less.
11. Items needed to Apply: Please have the information listed below available at the time the application for a reverse mortgage is completed:
a. Original counseling certificate provided by third party reverse mortgage counselor. (Please refer to item #4).
b. Photocopies of driver's license, social security card and birth certificate, if available.
c. Copy of recent property tax statement, deed to the home and homeowner's insurance bill.
d. Original death certificate of spouse if a widow(er). This is needed only if deceased spouse has not been removed from title to property.
e. Copy of statement with names, addresses and account numbers for mortgage debt.
f. If the property is held in a trust, please provide us with an entire copy of the trust agreement.
g. If the person signing has Power of Attorney for the borrower, please provide us with a copy of the Durable Power of Attorney.
h. If the property previously had a mortgage balance, which was paid for in full, please provide us with a copy of the Satisfaction of Mortgage.
i. Check made payable to Vanguard Mortgage & Title, LLC for $350.00, which is applied toward the appraisal cost. This can be refunded to you at closing.
Please don't hesitate to call us at 314-993-6690 or 314-283-0098/Mobile if you have any questions or if you would like to speak with your Reverse Mortgage Specialist.
We look forward to working with you!Gary BussardENVOY MORTGAGE10121 Paget DriveSt. Louis, MO 63132(314) 993-6690 Office(314) 283-0098 Mobile(314) 569-0161 Fax[email protected]