Reverse Mortgage Process
Our approach to the reverse mortgage process helps identify your goals and the steps required to attain them. It goes without saying, you aren't in any rush to acquire a product until you fully understand how it's going to benefit you. Everything moves at your pace and comfort levels.
Initial Visit With Our Expert
First step is to take a deep breath and relax. No matter how much you may or may not like what you hear, no decisions get made on the first visit. The reverse mortgage process is very deliberate. The initial visit is designed to educate you on the pros and cons of the reverse mortgage. We listen to you as you share what you are trying to accomplish. Then we will share ideas on how to best attain them.
Because the Reverse Mortgage is versatile, it can be very effective in meeting current and future needs. We will discuss how the process works, associated fees, potential downsides, and a host of other topics. We will leave behind the information packet for you to review.
Feel free to invite any and all advisers, family, friend, attorney, financial planner, etc, that you trust
If they are not available for the initial visit, then we can schedule a follow up. We move at your pace
Required 3rd Party H.U.D. Counseling Session
This step is very important in the Reverse Mortgage Process. The U.S. Department of Housing and Urban Development (HUD) requires that all applicants receive third-party counseling to explain the available options and details of a reverse mortgage. The counselors are contracted by HUD and have zero financial interest in whether you complete the reverse mortgage process or not. Your licensed expert will assist you in finding your local counselor. After choosing one, counseling can be done either in person at the counselors office or over the phone. If transportation is needed, we can provide it to visit the counselors office. Once counseling is completed, you will be given a completion certificate. Hang on to it. If you decide to move forward, we will need to submit it for future approval
Fill Out Application and Order Appraisal
While you still have time to change your mind, this is the first formal step in the reverse mortgage process towards actually securing it. We'll walk you through the application, collect relevant documents, order the appraisal, then submit all of it to underwriting.
Appraisals are done by an independent FHA approved appraiser. As expected, the appraisal determines home value. Home value has a significant impact on how much money you can access, along with age, and current interest rates.
Documents we'll need to make copies of:
1-Driver’s license 2-Social Security card 3- Hazard insurance (declaration page) 4-Mortgage statement (if applicable) 5-Trust papers (if applicable) 6- Power of attorney (if applicable) 7-Original HUD signed counseling certificate
Complete Underwriting Conditions
Underwriters will review all the paperwork and give feedback on conditions that need to be met in order to approve your reverse mortgage. For example, some homes may require some repairs as stated by the appraiser in order to meet FHA guidelines. Once the conditions have been identified, we will assist you in getting them resolved.
Closing and Funding
It's time to complete the process. In Colorado, closings typically take place at the title company's office. When needed, performing the closing can be done in your home.
One more layer of protection established for you by the federal government is the the 3 Day Right Of Rescission. During this time, you have another opportunity to walk away if for whatever reason if you are not comfortable.
Then the great news, on day 4, YOUR money is distributed and any existing mortgage payment will be eliminated. Money disbursements are typically done by electronic transfer.
When necessary, we have been able to arrange closing at your home.
Time To Enjoy And What Happens Next
Day 4, Is a fun day. You now have access to YOUR money without the nuisance of a mortgage payment. Whether you decide to take a lump sum, monthly income, build your line of credit or simply enjoy the elimination of your mortgage payment, you have the flexibility to do what you want with all of it.
Do not forget, you still maintain ownership of your home. As such, you are required to stay current with your property taxes, home owners insurance, HOA fees, and maintain the home in good condition. The Servicing Company will contact you periodically to confirm you still maintain the property as your primary residence.
As the owner, you have the freedom to sell your home if you decide you would rather live somewhere else. Of course, any money used must be repaid. The same thing happens if you happen to pass away. Your heirs can decide if they want to keep your house or sell it and split the remaining equity. If the money/interest used surpasses the actual value of the home, then the kids just walk away and enjoy the rest of your estate...if you are kind enough to leave them anything. The lender can only be paid from the proceeds of the sale of the home and the rest of the estate is off limits.
Now, it is time to start enjoying all those things you wanted to accomplish