You may qualify for a
Reverse Mortgage.

Improve your

retirement

With a

reverse mortgage

Fees associated with a Revers Mortgage

Reverse Mortgage Fees

Many of the costs to obtain a home purchase or refinance also apply to reverse mortgages. Typical charges are: origination fee, mortgage insurance, appraisal fee, and other standard closing costs. These fees and costs are typically capped and may be financed in as part of the reverse mortgage.

Origination Fee

An origination fee covers a lender's operating expenses including office overhead, marketing costs, etc. The entire amount of the origination fee may be financed as part of the mortgage.

Under the HECM (Home Equity Conversion Mortgage) program is equal to the greater of $2,000 or 2 percent of the maximum claim amount set by the FHA loan limit and differs for each county. You can check FHA loan limit for your area. A 2 percent origination fee generally ranges between $3,204 and $5,806 depending on the value of the home.

Home Keeper origination fee's may not exceed 2 percent of the value of the home.

Mortgage Insurance Premium

Under the HECM program, borrowers are charged a mortgage insurance premium (MIP) equal to 2 percent of the maximum claim amount, or home value, whichever is less, plus an annual premium thereafter equal to 0.5 percent of the loan balance. The insurance guarantees that government caries out the terms of the loan and also guarantees that you will never owe more than the value of the home when the HECM must be repaid.

Appraisal Fee

A state certified appraiser is responsible for assigning a current market value to your home. Appraisal fees typically range between $300-$400. Federal regulations mandate a home must be structurally sound and in compliance with all home safety codes in order to be eligible for a reverse mortgage. An appraiser must also verify there are no major structural defects such as a foundation, roof, or termite damage.

If any defects are noted. A certified contractor must complete the repairs. Once completed, the same appraiser is paid for a second visit to make sure the repairs have been completed. The cost of the repairs may be financed in the loan and completed after the reverse mortgage is made. Appraisers generally charge $50-$75 dollars for the follow-up visit.

Closing Costs

Other closing costs that are commonly charged to a reverse mortgage:

  • Credit report fee $20. Verifies any federal tax liens, or other judgments, handed down against the borrower
  • Flood certification fee $20. Determines whether the property is located on a federally designated flood plane
  • Escrow, Settlement or Closing fee $150-$450. Generally includes a title search and various other required closing services
  • Document preparation fee $75-$150. Fee charged to prepare the final closing documents
  • Recording fee $50-$100. Fee charged to record the mortgage lien with the County Recorder's Office
  • Courier fee $50. Covers the cost of any overnight mailing of documents between the lender and the title company
  • Title insurance fee varies with size of loan. protects against any loss arising from disputes over ownership of a property
  • Pest Inspection fee $100. Determines whether the home is infested with any wood-destroying organisms, such as termites
  • Survey fee $250. Determines the official boundaries of the property

Servicing Set-Aside

The servicing set-aside is an amount of money deducted from the available loan limit at closing to cover the projected costs of servicing your account. Federal regulations allow the loan servicer (which may or may not be the same company as the originating lender) to charge a monthly fee that ranges between $30-$35. This fee is set aside and only a calculation (not a charge).

TO MAKE IT SIMPLE THE BEST WAY TO IMPROVE YOUR RETIREMENT IS TO
UTILIZE A REVERSE MORTGAGE. THE REASONS ARE SIMPLE AND ARE AS FOLLOWS.

  • Stop Paying Your Monthly Mortgage Payment
  • No Medical Requirements
  • No Income Requirements
  • No Credit Requirements to Qualify
  • Stop Worrying About Mortgage Payment and Increase your Cash Flow
  • Title Remains in Your Name as Long as You Live in the Home
  • The Lender Pays the Homeowner TAX Free Payments "REVERSE MORTGAGE"
California Real Estate

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