Mortgage Calculator Me Logo
mortgage calculators categories
Reverse Mortgage Types
Reverse Mortgage
Advantage Of Lease Purchase
Lease Options
Lease To Purchase
Private Mortgages
Hard Money Mortgages
How To Get A Mortgage For Investment
Buy To Let Mortgage Refinancing
What Is An Offset Mortgage
mortgage calculators categories
search categories
 
Web This Website

mortgage calculators bread crumb home > Blog

Home Equity Conversion Mortgages

The Home Equity Conversion Mortgages (HECM) is a type of reverse mortgage which allows seniors to convert the portion of the home equity into cash. The homeowner can stay in the home while the homeowner uses the home equity. With the cash, the homeowner can use the cash into any expenses such as medical, home improvements, and home repairs.

This reverse mortgage type is one of the three basic reverse mortgage types. It is also known as Federally Insured Reverse Mortgage. Hence, Federal Housing Administration (FHA) backs the Home Equity Conversion Mortgages. The FHA works under the US Department of Housing and Urban Development (HUD).

The banks, credit union, mortgage companies, and savings and loan companies can provide the services. FHA must approve the financial institution before the financial institution can offer this type of reverse mortgage.

There are four requirements for homeowner to quality. First, the homeowner must be sixty two years old or over. Second, the home is a principal residence of the homeowner. Third, the homeowner received reverse mortgage counseling. Fourth, the homeowner owns the home. Or, the home is almost paid off.

The reverse mortgage counseling is a free counseling from HUD. The HUD wants the homeowner to know the consequences, and benefits before the homeowner uses the reverse mortgage. For a while, the homeowner pays for the reverse mortgage counseling. Now, the HUD instructed the financial institution to deal with homeowner that dealt with free reverse mortgage counseling only.

There are five requirements for the home to qualify. First, the home is a principal residence. Second, the home can be a single family residence. Third, the home can be one to four units as long as the homeowner occupies one unit. Fourth, the home is manufactured or mobile home. Fifth, the home is FHA condominiums.

The maximum claim amount of reverse mortgage depends on the age, home value, and interest rate. For example, the interest rate is nine percent. The homeowner who is sixty five years old can use twenty six percent of home equity. The homeowner who is seventy five years old can use thirty nine percent of the home equity. The home owner who is eighty five years old can use fifty six percent of the home equity.

The homeowner receives the home equity in the form of monthly payment, credit line, lump sum payment, or combination. The home secures the reverse mortgage. The homeowner do not repay as long as the homeowner lives in the home. The homeowner still owns the home. It is still the responsibility of the homeowner to pay the repairs, maintenance, property tax, and insurance.

0 Comments:

Post a Comment

<< Home


Tags: morgage calculators, morgage calculator, morgages_, morgages, morgage, mortgage claculator, mortgage calcutator, mortgage caculator
mortgage calculators categories

Mortgage Calculators

Read about articles, facts, real-life stories, resources, and tutorial on mortgage and real estate.

list of partners
mortgage calculators categories
How do you subscribe to Mortgage Calculators Blog
blog xml
Subscribe in NewsGator Online
Add Mortgage Calculators Blog to Newsburst from CNET News.com
Add to My AOL
Subscribe in Bloglines
Add to netvibes
Add to Bitty Browser
Add to Plusmo

Copyright (c) 2005-2009 MortgageCalculatorMe.com. All Rights Reserved.

Information and calculation provided on this mortgage calculators website is for general purposes only. It is not intended to take the place of advice from your mortgage brokers.