Facing the reality of retirement can be challenging. If you are a homeowner 62 years of age or older, with moderate to significant equity in your home, a reverse mortgage may be right for you. This type of mortgage is especially designed for seniors who own a house, but need some cash to live on. Chris Lamm: Redding Mortgage Lender is prepared to help Redding residents with reverse mortgage loans.
The HECM Program
The HECM (Home Equity Conversion Mortgage) is a federally insured reverse mortgage program and is the most prominent reverse mortgage product in the market. This product is safe and lower-risk for all parties involved. There are a few program options available through Chris Lamm under the FHA-insured HECM Program; they are as follows:
- Monthly Adjustable Rate
This is an adjustable rate program with a varying margin added to the index. The rate adjusts on a monthly basis and is tied to the LIBOR (London Interbank Offered Rate) plus the applicable margin. Under this type of loan, the borrower decides how he or she wishes to receive the disbursements: as a line of credit, in monthly payments, as a lump sum, or as a combination of these three options. Interest is only charged on withdrawals.
- Fixed Rate
This is a fixed rate program. This program requires that a borrower takes all proceeds available as a cash-out in a lump sum at closing. The one benefit of doing it this way is that it can be put in an interest-bearing account and draw interest on all funds that aren’t being used.
- Purchase Options
You can even purchase a home using a reverse mortgage loan. Certain restrictions apply, however. Most costs associated with a reverse mortgage can be financed into the loan; this means that they can be paid from the proceeds of your reverse mortgage transaction.
Unlike traditional mortgages, there are no payments required back to the lender until the last surviving borrower on the title no longer occupies the home as their primary residence.
Do you have more questions? Reach out to Chris Lamm: Redding Mortgage Lender, a trusted and ethical lender that cares about your welfare. He and his staff have been helping families navigate their reverse mortgage loans in Redding, California, for the past 10 years.
Call 530-206-8613 or click on our free reverse mortgage qualifier below to find out how it could help you!