Lenders simple explanation of a Reverse Mortgage
Getting a reverse mortgage doesn't have to be complicated Process. A few simple steps involved in finding and qualifying for a reverse mortgage.
- Do your own research before contacting a reverse mortgage lender. Try a reverse mortgage calculator, so you have an idea of how much and what type of loan might suit you best. AARP has many resources about reverse mortgages. Always check with friends and family to see if anyone has a reverse mortgage to find out about their experience.
- Find a reputable reverse mortgage lender through HUD (U.s. Department of Housing and Urban Development) You can contact your state attorney general's office or the Better Business Bureau to check out lenders.
- You required to have counseling before applying for a reverse mortgage from a HUD-approved counselor or national counseling agency such as AARP or the NFCC (National Foundation for Credit Counseling). You can receive counseling over the phone or in person.
- Apply for a mortgage. Truth in Lending Act requires that your lender should give you an estimate of the total costs.
- Have your lender order the appraisal to make sure it meets Federal Housing Administration guidelines. You are responsible for all necessary repairs that are required. Keep in mind the cost of these repairs can be taken from the proceeds of the mortgage.
- You have up to the underwriting period to will finalize all details of the mortgage and that can take a few months.
- When you sign the paperwork at the closing, the interest rate for your reverse mortgage will be calculated. The Truth in Lending Act gives you a 3 day right of rescission after closing. No questions asked.