• Tel: (440) 296-9876
    Email: info@rocketreversemortgage.com

  • FAQ

    • 1. What is a reverse mortgage?

      A reverse mortgage is also referred to as a Home Equity Conversion Mortgage, or HECM. A reverse mortgage is a unique type of home mortgage loan which allows you to convert the equity in your home into cash for you. This will allow you to receive cash that is paid to you through your ability to build equity in your home over the years. A reverse mortgage greatly differs from a regular mortgage because unlike a regular mortgage, you do not have to repay the reverse mortgage. With a reverse mortgage you do not have to repay the loan for as long as the home remains your primary residence, or you fail to meet the obligations of the mortgage. Reverse Mortgages can also be used to purchase a primary residence.

    • 2. I did not buy my current home with FHA mortgage insurance. Can I still apply for a Reverse Mortgage?

      Of course you can still apply and qualify for a reverse mortgage. You do not have to have ever had an FHA loan to qualify for an FHA reverse mortgage. 

    • 3. What kind of homes are eligible for reverse mortgages?

      Single family homes and 2-4 unit homes that have one unit occupied by the borrower are eligible for reverse mortgages. Also, manufactured homes that meet FHA requirements and HUD approved condo's are also eligible as long as they are occupied by the borrower.

    • 4. Is there a difference between a reverse mortgage and a home equity loan?

      Yes they are totally different types of loans. With a home equity loan, a second mortgage, or a home equity line of credit, you must make monthly payments on the principal and interest of the loan. However, with a reverse mortgage, the reverse mortgage lender pays you. You do not have to make monthly principal and interest payments. *Keep in mind though that with any type of mortgage, or anytime you own a home for that matter, you will always be responsible to pay for your real estate taxes, utilities, and homeowner's insurance. 

    • 5. What is an HECM?

      An HECM is simply the actual name of a reverse mortgage. HECM stands for Home Equity Conversion Mortgage. You will often see HECM and reverse mortgage used interchangeably. 

    • 6. How much money am I eligible to receive from my home with a Reverse Mortgage?

      The amount you are eligible to qualify for with a reverse mortgage depends on the borrower and:

       

      1. Age of the youngest borrower or eligible non-borrowing spouse
      2. Current interest rate
      3. The lesser of the appraised value or the HECM FHA mortgage limit of $625,500 or the sales price
      4. Finally, how much of an origination fee your lender is charging you. We here at Rocket Reverse Mortgage do not charge an origination fee and therefore can always guarantee you we will be able to give you the most money possible. 

       

      If there is more than one borrower and no eligible non-borrowing spouse, the age of the youngest borrower is used to determine the amount you can borrow.

    • 7. How do I receive my payment(s) from a reverse mortgage?

      There are several options available when it comes to receiving your money from a Reverse Mortgage.

      If you have an adjustable rate reverse mortgage you can choose one of the following:

       

      • Tenure- equal monthly payments as long as at least one borrower lives and continues to occupy the property as a principal residence.
      • Term- equal monthly payments for a fixed period of months selected.
      • Line of Credit- unscheduled payments or in installments, at times and amounts that you choose until the line of credit is completely used up.
      • Modified Tenure- this is a combination of a line of credit and scheduled monthly payments for as long as you live in the home.
      • Modified Term- this is a combination of a line of credit and monthly payments for a fixed period of months selected by the borrower.

       

      If you have a fixed rate reverse mortgage you will receive a Single Disbursement Lump Sum payment plan. This Single Disbursement Lump Sum payment plan is when you receive a single lump sum of money at the closing of the mortgage. 

       

       

    • 8. How to I know if I qualify for a Reverse Mortgage?

      You can talk with one of our Reverse Mortgage Specialists here at Rocket Reverse Mortgage to find out more about qualifying.

       

      The requirements to qualify for an FHA HECM reverse mortgage are the following: 

       

      • you must be 62 or older
      • you must either own your home without a mortgage or have equity built up within your home to pay off a mortgage at closing.
      • you must have the financial resources available to pay ongoing property charges such as homeowners insurance and property taxes.
      • you must live in the home as your primary residence
      • you must receive counseling from an HECM counselor (we will help you set this up throughout the reverse mortgage process)

       

    • 9. Can I still leave the house to my children?

      Yes you can leave the house to your kids and/or anyone you want.

    • 10. What happens to our home if we decide to sell or pass away?

      Once the home is no longer used as a primary residence or sold, any unpaid reverse mortgage finance charges, cash or interest must be repaid. All money leftover will belong to your spouse or estate. Yes, you can still leave your heirs/family with anything that is leftover. You also do not have to worry because no debt is every passed along to the estate or heirs from a reverse mortgage. 

    • 11. Will I still own my home if I get a reverse mortgage?

      Yes, you will definitely still own your home, just like you would with any other mortgage. As long as you continue to pay your property taxes, homeowners insurance, and maintain the home according to FHA guidelines you will own the home and nothing changes. 

    • 12. Will I need to pay taxes on the money I receive from a Reverse Mortgage?

      Absolutely not. The money you receive from a reverse mortgage is not considered income and therefore is not taxable