Reverse Mortgages Can Benefit Seniors
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By Percy Ihara
Reverse Mortgage Specialist
Like any other financial transaction, getting a reverse mortgage involves a number of steps designed to protect both you and the lender.
Here are the steps you can expect to go through when you apply for your reverse mortgage with Financial Freedom:
INITIAL DISCUSSION
The first thing we like to do is talk to you, either over the phone or in person, about whether a reverse mortgage is right for you. We talk about the pros and cons, how it works, how much money you might receive and anything else you’d like to know about. Then you decide whether you want to take the next step.
COUNSELING
If you decide that a reverse mortgage is the right choice, you receive free independent counseling from a certified, HUD-approved counselor to make sure that you have had all your questions answered and that there’s been no confusion. It’s a protection device that the government has built into the process of obtaining a reverse mortgage.
APPRAISAL
Then we arrange for an appraisal to determine the objective market value of your home, and whether any repairs will be required to meet Federal Housing Administration guidelines.
INSPECTION
In many cases an inspection is required to make sure that the home is structurally sound and that there’s no extensive termite or dry rot damage.
UNDERWRITING
After the appraisal and inspection reports come in we go through all the normal processing procedures that you might find in any mortgage.
CLOSING
The final step is the closing where you receive the money, or proceeds, from your reverse mortgage. You can choose to receive the payment in one of three ways: as a lump sum, as a monthly payment or as a line of credit.
Then it’s up to you: pay bills, fix up the house, help a family member, or use the money to enjoy your life.
At Financial Freedom, we’re proud of our reputation for integrity and we adhere to the highest ethical standards in dealing with seniors and their advisors.
CONSUMER SAFEGUARDS
As pioneers of the industry, we’re a founding member of NRMLA, the National Reverse Mortgage Lenders Association, and we subscribe to the NRMLA Code of Conduct and Best Practices Standards created to protect seniors from predatory lending practices.
Here’s what we’re doing to ensure that you get objective, complete and honest information when you do business with Financial Freedom.
DOCUMENTING YOUR OPTIONS.
Our Reverse Mortgage Specialists provide each senior borrower with a document, created by Financial Freedom’s innovative, proprietary software program, that clearly illustrates all products and benefit options available to that senior.
INVOLVING YOUR ADVISORS.
We encourage all of the senior borrower’s advisors, both personal and professional, to meet with our Reverse Mortgage Specialists to review the needs and options available to that senior.
UNMATCHED TRAINING.
Our Reverse Mortgage Specialists receive the most comprehensive training in the industry, including training on how to protect the interests of our senior customers and prospective customers.
A reverse mortgage could be an ideal way for your parents to benefit from the wise investment they made in real estate perhaps decades ago. If you are the son or daughter of a senior who is age 62 or older, you should understand the facts about reverse mortgages.
FOR THE FAMILIES OF SENIORS
Get money without moving. A reverse mortgage can help your parent(s) create a new source of tax-free* money without having to sell their home. In fact, they can stay in the home they love for as long as they’d like.
Financial independence. A reverse mortgage allows seniors to tap into money they’ve earned in the form of home equity, and avoid having to depend on relatives for financial assistance.
Keep title to the house. Your parents retain full title to their home and have no risk of losing the home to the lender. And no matter what happens to the housing market, your parents can never owe more than the value of their home when it is sold.
Proven safe. Over 150,000 Americans have already benefited from reverse mortgages. The fact is that HECM reverse mortgages are government-protected loans and many safeguards are in place to protect seniors from unethical lending practices.
Repayment options. If your last-remaining parent passes away while living in the home, you, as the heir(s), simply pay off the reverse mortgage principal plus accrued interest. If you or a sibling or other relative want to keep the home in the family, you can take out a new traditional mortgage or use other assets to pay for it. If no one in the family is interested in keeping the home, it can be sold to repay the loan. Any money left over goes to the estate to be shared according to your parents’ last wishes.
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