Home Equity Convention Mortgage is a government institution which helps you to utilize the value of your home and convert it into cash, but it depends on you that how much you want to convert.
Many senior homeowners have taken advantage from this technique since its inception in 1961.
Eligibility of Reverse Mortgage depends on:
- General requirements which contains age 62+, is a homeowner and some others
- Home qualifications which contains HUD and FHA rule
- Financial Qualifications which contains homeowner income and debt
Age must be 62 years or above. As this loan is available to individuals in retirement age because reverse mortgage was designed to help seniors age in their homes.
- You must have your own home:
You must be an owner of home or low enough remaining mortgage balance for the reverse mortgage loan to pay it off.
- Your home must be your main residence:
As this loan was designed to help seniors stay at home, so borrowers must stay in his home and cannot live any other place for more than 12 consecutive months.
- You must complete a counseling session with a HUD-approved consoling agency:
With the help of this session you are aware of all your options and can evenly weigh the pros and cons of each.
Contains 4 major points:
- Must be a single family home
- 4 unit maximum multiple family home
- 1 unit occupied by you
- Your home must be manufactured home as long as it meets FHA requirements
- Pay your property taxes, home maintenance, insurance and any applicable HOA fees:
Keep in mind it is your responsibility to pay all expenses related to house like property taxes, home maintenance, insurance and any applicable HOA fees because you are living in the home right now. Otherwise you may be at risk of defaulting on the loan.