Florida Reverse Mortgage Loans, Best Rates
Florida Reverse Mortgage Loans are Seniors Age 62 and Older.
Florida Reverse Mortgage Loan, HECM reverse mortgages are insured by the Federal Housing Administration (FHA) and allow homeowners to convert their home equity into cash with no monthly mortgage payments.
After you obtain a reverse mortgage, you must continue to pay your property taxes and homeowners insurance and maintain the home according to FHA guidelines. Typically the loan does not become due and payable in full as long as you live in your home as your primary residence and continue to meet all the FHA loan obligations.
Florida Reverse mortgage loans are commonly used to pay for home renovations, medical and daily living expenses. Homeowners who have an existing mortgage often use the reverse mortgage loan to pay off their existing mortgage and eliminate their monthly mortgage payments.
A Florida reverse mortgage loan uses a home’s equity as collateral and the amount of money the borrower can receive is determined by the age of the youngest borrower, the interest rate and the lesser of the home’s appraised value, sale price and the maximum loan limit. The funds available to you may be restricted for the first 12 months after loan closing, due to (FHA) HECM requirements. In addition, you may need to set aside additional funds from loan proceeds to pay your property taxes and homeowners insurance premiums.
This loan does not generally have to be repaid until 6 months after the last surviving homeowner moves out of the property or passes away. At that time, the estate typically sells the home to repay the balance of the reverse mortgage and the heirs receive any remaining equity. The estate is not personally liable for any additional mortgage debt if the home sells for less than the payoff amount of the reverse mortgage loan.
Reverse Mortgage Eligibility
To be eligible for a reverse mortgage loan, the FHA requires the youngest borrower on the title to be 62 years or older. Borrowers must also meet financial eligibility criteria as established by (FHA) HUD. If there is an existing mortgage on the home, it must be paid off with the refinance proceeds from the reverse mortgage loan.
Eligible Homes Types for Reverse Mortgages
- Single-family homes.
- Two-to-four unit owner-occupied dwellings.
Are all eligible for a reverse mortgage loan however the home must meet the FHA minimum property standards.
When the reverse mortgage loan does become due, the borrower’s heirs/estate can choose to repay the reverse mortgage loan and keep the home or put the home up for sale in order to repay the loan. If the home sells for more than the balance of the reverse mortgage loan, the remaining amount of the home’s equity passes to the heirs.
If the home sells for less than the owed balance, the estate is not required to pay more than the value of the home at the time the loan is repaid.
A reverse mortgage loan is “non-recourse”, meaning that if you sell the home to repay the loan, you or your heirs will never owe more than the loan balance or the value of the property, whichever is less; and no assets other than the home must be used to repay the debt.
Distribution of Funds
Reverse mortgage loan proceed can be received in any combination of the following options:
• A line of credit – draw as needed up to the maximum eligible amount
• Lump sum – a lump sum of cash at closing (only available on fixed-rate loans)
• Tenure – monthly payments for the life of the loan
• Term – monthly payments for a specific number of years
Borrowers may access the greater of 60 percent of the principal limit amount or all mandatory obligations, as defined by the (FHA) HECM requirements, plus an additional 10% during the first 12 months after loan closing. The combined total of mandatory obligations plus 10% cannot exceed the principal limit amount established at loan closing.