What is Borrower Requirements & Responsibilities

/What is Borrower Requirements & Responsibilities
  • Age Requirement: There is a minimum age requirement of 62 years or older. If one spouse qualifies and the other does not meet the age requirements, obtaining the Reverse Mortgage line of credit is still possible, but more information will be needed to assess eligibility.
  • Clear Property Title: If there are existing liens on the property, they must be paid off. This may be done with funds obtained from the reverse mortgage, or by another means. The lender for the reverse mortgage will become the primary lien holder.
  • Insurance & Taxes: It is the responsibility of the borrower(s) to keep all real estate taxes paid and current. In addition, all homeowners insurance and other associated fees and assessments must be kept current.
  • Property Condition: The Borrower(s) must keep the property in a good condition.
  • Occupancy: The property is the collateral that the reverse mortgage is based upon. Therefore only primary residences qualify for a reverse mortgage. Vacation homes or other investment properties do not qualify.
  • Upon the death of the borrower: The reverse mortgage becomes due and payable. If a husband and wife have a joint reverse mortgage, the conveyance of the mortgaged property does not proceed until the death of the surviving borrower. When the last borrower dies, the heirs have the option of satisfying the HECM (Home Equity Conversion Mortgage) debt and will be required to pay the lesser amount of either the balance of the mortgage or 95% of the appraised property value.
2019-01-16T11:52:58+00:00