HECM Loan Programs Overview HECM (Home Equity Conversion Mortgage) loan programs are designed according to strict guidelines established by the Department of Housing and Urban Development (HUD) and are federally insured by the Federal Housing Administration (FHA). To qualify for a HECM loan, individuals must undergo a Financial Assessment by HUD and consult with a government agent to understand the intricacies of a Home Equity Conversion Mortgage.
While the following descriptions offer a basic understanding of each HECM loan product, we recommend contacting one of our licensed specialists at Simply Reverse for a detailed discussion. Making an informed decision is crucial, and we are committed to guiding you through every aspect of the process, ensuring your comfort and confidence in your choices.
HECM Monthly Adjustable Cap 5
Offers a lifetime cap of 5% above the original start rate.
Allows for an equity line for convenient fund access.
Monthly interest rate adjustments with a maximum annual adjustment of 2%.
HECM Traditional Monthly Adjustable Cap 10
Features a lifetime cap of 10% above the start rate.
Offers an equity line for financial flexibility.
Monthly interest rate adjustments with no annual interest rate cap.
HECM Fixed Rate for a Lifetime
Provides a fixed interest rate for the entire loan term.
Option to purchase a lower fixed rate at loan initiation.
Only allows for a one-time lump sum disbursement, not an equity line.
HECM Home Purchase Loan
Enables individuals over 62 to purchase a home using a HECM loan.
Requires a larger down payment than traditional financing.
Eliminates the need for future mortgage payments, except for property taxes and homeowner’s insurance.
Jumbo Proprietary Reverse Mortgage Options For homeowners qualifying for a Jumbo proprietary reverse mortgage, fixed and Adjustable Jumbo ARM products offer access to up to $4 million in tax-free cash. These private reverse mortgage offerings provide flexibility in disbursement options and are available for properties valued at over $850,000.
Benefits of Jumbo Proprietary Reverse Mortgages:
Elimination of monthly mortgage payments.
Larger cash disbursement for high-value properties compared to traditional HECM products.
Maintenance of ownership and title by the borrower.
Borrowing capacity is determined by property value, interest rate, and borrower’s age.
Qualifications for Jumbo Proprietary Reverse Mortgages:
The minimum A loan age requirement of 62.
Ownership of a high-value primary residence.
Loan must offer more proceeds than a traditional HECM reverse mortgage.
Contact our team at Simply Reverse to explore the best loan options tailored to your needs and financial goals.
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