If you meet the reverse mortgage age requirement of 62 years, you could be a candidate for the federally-insured Home Equity Conversion Mortgage (HECM) program.
The loan can enable you to remain in your home longer and does not need to be repaid for as long as you maintain principal residency in your home and keep up with property taxes and insurance. Because the length of the loan depends directly on how long you live in the home, the amount you can borrow also depends on that time frame, including the age at which you get the reverse mortgage.
Reverse mortgage proceeds can be accessed in a few different ways—as a line of credit, as monthly term or tenure payments, as a lump sum, or some combination of those options—and can be used in whatever way you’d like; for groceries, medication, or even utility bills.
Borrowers must pay an upfront mortgage insurance premium along with annual mortgage insurance of 1.25% of the loan balance.
Which Program Should I Choose?
There are a couple of different HECM programs to choose from, including the Saver and the Standard loan options. The HECM Saver offers lower upfront fees in exchange for a smaller loan amount.
While the HECM Standard program charges an initial mortgage insurance premium of 2% of the maximum claim amount (the value of your home up to the lending limit of $625,500), that drops to just .01% of the maximum claim amount for HECM Saver loans.
Borrowers who choose an adjustable rate loan have several options of how to receive their loan proceeds, including a line of credit, monthly payments, or even a lump sum.
If you’re interested in a lump sum, you could also get a fixed-rate loan through the HECM Saver program. (Compare Fixed vs Adjustable Programs)
How Much Can I Receive from a Reverse Mortgage?
The amount of money you can receive from a reverse mortgage depends on a few factors:
current interest rates and fees.
Your age plays a large role, because the older you are the more money you will qualify when you take out the reverse mortgage.
Article Source: https://reverse.mortgage/age-impacts-loan-size