5319 University Drive #23
Irvine, California 92612


Reverse Mortgages

Convert a portion of your greatest asset - your home euity - to fund your retirement needs.

What is a HECM Reverse Mortgage?

Home Equity Conversion Mortgages (HECMs), also known as reverse mortgage loans, were created over 25 years ago to help Americans aged 62 and older convert a portion of their home equity into tax-free money to improve their lifestyle in whatever way they coose.  While loan proceeds are not taxable income, property taxes and insurance must be paid by the borrower. 

How Does it Work?

With a reverse mortgage loan, borrowers do not make monthly principal and interest payments on the loan.  Instead, the loan blance is typically repaid when the last borrower or eligible non-borrowing spouse, leaves the home or deos not otherwise comply with loan terms.  Borrowers are responsible for paying taxes, homeowners insurance, HOA dues (if any), maintaining the property and complying with all loan terms.  Not complying with all loan terms can result in defulting on the loan and borrowers an be subject to foreclosure.

HECMs Have Built-in Safeguards to Better Protect Borrowers

The United States Department of Housing and Urban Development (HUD) has put safeguards in place to protect borrowers and further strengthen the HECM reverse mortgage loan product.  

  1. Financial Assessment - Now, HUD requires a more thorough evaluation of a borrower's ability to meet the obligations of his/her HECM reverse mortgage loan.
  2. Non-borrowing Spouse - New loan amount are available to borrowers with a non-borrowing spouse under the age of 62.  Rules allow the eligible spouses of borrowers who pass awy to stay in the home without foreclosure as long as the surviving elibigle spouse complies with the loan terms.
  3. More Affordable - Upfront mortgage insurance premiums (MIPs) have been lowered by the FHA.  As long as you don't take more than 60 percent of your proceeds in the first year, you will be charged a MIP of 0.5% of the appraised value of the home.  If you cross the 60 percent threshold, the upfront MIP will be 2.5%.

Common Uses of a Reverse Mortgage

  • Pay off an existing mortgage and eliminate monthly mortgage payments
  • Make retirement savings last longer
  • Use a "standby" HECM reverse mortgage growing line of credit to preserve investment accounts during the market downturns or build a safety net for unplanned emergencies, home repairs and healthcare expenses
  • Supplement your retirement income with monthly premiums
  • Use a HECM for Purchase loan to buy a home that better fits your needs
  • Support aging in place expenses, like caregiving and home modifications

CALL TODAY (949) 427-2999 and find out how much cash you may qualify for!

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