As Orange County seniors become more educated on the Reverse Mortgage program, originations of this program have increased. 2010 will be another big year for the Reverse Mortgage loan program.
Times are tight as the economic downturn has weighed heavily on household expenses. Seniors who need help with medical expenses, repairs to their home, or just need extra income to supplement their retirement income, are finding that a Reverse Mortgage can solve these problems are relieve unwanted stress. The first thing an Orange County senior needs to do is understand what their options are and how a Reverse Mortgage works. Seniors need to understand fees involved with this program and the repayment options.
What is a Reverse Mortgage?
Reverse Mortgages allow homeowners to convert equity in their home into cash while retaining ownership of their home. This is important to understand, as some people believe they will give up ownership in their home by getting a Reverse Mortgage. This program is called a “Reverse” mortgage, rather than a “forward” mortgage, because instead of making monthly payments to your lender, you will receive monthly payments from your lender. As your lender sends payments to the Orange County Reverse Mortgage borrower, the loan amount increases, thus decreasing the amount of equity in the home.
What is the Most Commonly Used Reverse Mortgage in Orange County?
The most common Reverse Mortgage program used in Orange County, and really anywhere in California, is the FHA HECM program. HECM stands for Home Equity Conversion Mortgage. (Pronounced HECK ‘EM) The HECM is insured by the Federal Housing Administration FHA) which is part of the US Housing and Urban Development (HUD). FHA guarantees that the lender will meet their obligation to the Orange County Senior Reverse Mortgage borrower. HEMC’s are only offered through Federally approved lenders who are required to follow strict guidelines set forth by FHA. It is FHA who determines the loan amounts allowed based on a senior’s age and the equity they have in their home.
What are the Basic Requirements for a HECM?
To qualify for a Reverse Mortgage, an Orange County senior must own a home (of course.) Also, all borrowers on the loan need to be a minimum 62 years of age. Also, the property must be the borrowers primary residence. There are no income or credit requirements since the borrower will not be making payments. This means that even someone with no income, and bankruptcy , and a sub 500 FICO score (which is very low) would still qualify, provided they had enough equity in their home.
Orange County seniors interested in checking out their options should contact a local Orange County Reverse Mortgage loan officer. The loan officer will be able to quickly provide the options available. There are no costs up front or paid out of pocket, making the research process easy.
Authored by Tim Storm, an Orange County, CA Reverse Mortgage Loan Officer – Please contact my office at Trust One Mortgage for more information about an Orange County, CA Reverse Mortgage. 877-786-4243 x 7.
Contact us for your Orange County Reverse Mortgage:
877.786.4243 x 7 | tstorm (at) ochomebuyerloans.com
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