Reverse Mortgage

We at FIRST AMERICAN are proud to bring YOU the program called Reverse Mortgage.

As YOU know, there are many myths and rumors about this program. We are YOUR local broker that can help clear the air for YOU with honest answers.

Some things YOU need to know;

Government regulated

YOU have to be at least 62 years old

The older YOU are, the more YOU may qualify for

YOU still own YOUR home

No mortgage payments, YOU pay only taxes and insurance

Own YOUR home free and clear? Use the equity as YOU wish from monthly income to cash to spend as YOU wish, off set YOUR debt load, pay for insurance needs, new car, live in YOUR home mortgage free, many more benifits

If YOU owe a mortgage or land contract, let YOUR equity pay them off and be mortgage free, just pay taxes and insurance. Just think, no mortgage, more monies for YOU to use as YOU wish. Relieve YOUR debt load. Why be stressed about money?

If YOU owe a mortgage and are behind in payments or are in foreclosure, why not see if YOUR equity will pay it off and KEEP YOUR home and be mortgage free, just pay YOUR own taxes and insurance.

We believe the more YOU know the more YOU will make a proper decsion that benifits YOU.

We can only help if YOU contact us.....

James A Burchfield @ 616-218-0264

Frequently Asked Questions About Reverse Mortgages

1) How do I qualify for a Reverse Mortgage?

   * To become eligible for a reverse mortgage, you must be at least 62 yeras old and own your own home. You must have enough equity in the house to pay off outstanding loan balances, or have the funds to cover any "short to close amounts". Your home is also required to be occupied by you as your primary residence.

2) How much money can I get?

   * The amount of money a lender will loan depends on how old you are at the time of closing, how much your home is worth, the total amount of liens, and current interest rates. The type of reverse mortgage product and the payment options can also affect the amount of money you will recieve.

3) How do I recieve the money?

   * There are several different options to choose from. You can take the money in a lump sum, set up a line of credit, monthly payment or a combination of all three. Loan options are product specific, and not all products offer the same loan disbursement options.

4) What are the costs associated with Reverse Mortgage?

    * The costs of a "forward" loan are very similar to a reverse loan. For example, an origination fee is paid to the broker/ lender, a MIP ( mortgage insurance premium ) is paid to HUD on HECM loans, an appraisal fee, a flood certifacation fee, title and escrow fees, and other atandard closing costs.

5) Is it required that I recieve counseling before getting a Reverse Mortgage?

    * Yes. Counseling is required to protect seniors from recieving incorrect information about Reverse Mortgages. The lender must be in receipt of the counseling certificate before they can close the loan. To locate a Reverse Mortgage counselor near you, contact your loan officer or your local HUD office.

6) Do I get taxed on the money I recieve from my Reverse Mortgage?

    * The equity in your home is concidered your money and not additional income. All the funds from the Reverse MOrtgage are tax free. Please consult with your tax advisor for advise on your unique situation.

7) Do I have to pay any fees to the Reverse Mortgage lender during the coarse of my loan?

    * A Reverse Mortgage was created so seniors don't have to pay fees during the coarse of the loan. There is however, a monthly service fee, which is deducted from the service fee set aside account for ever month that you obtain the loan ( HECM and Home Keeper loans only ).

F A Qs For Childern And Heirs

A) Will mom and dad use up my inheritance?

     * While tapping into their equity, your parents' home will be appreciating in value, which could allow for some equity left at the end of the loan. They are also able to live comfortably without having to depend on family members to support them.

B) Will the bank take their home?

     * No, the bank will not take their home. Throughout the life of the Reverse Mortgage they will continue to own their own home and retain title.

C) How much money will they owe when the loan has to be repaid?

     * Your parents will owe the total amount borrowed, accrued mortgage insurance premiums, accumulated interest, sevicing fees, and any other costs and fees financed through the loan amount.

D) When do my parents repay the loan?

     * There are three viable options for your parents. They can sell the home to repay the lender and collect the proceeds, choose to reimburse the lender directly from a personal account, or refinance the loan.

E) What happens to the equity if my parents or I decide to repay the loan by selling the house?

     * Your parents have two options. Either your parents or the heirs can keep the home and pay the balance due on the Reverse Mortgage, or they can decide to sell the home and use the proceeds to pay off the Reverse Mortgage. Either way, the remaining equity is retained by the owners or their heirs.

F) What happens to my mom's and dad's house if they move into a nursing home?

     * A Reverse Mortgage becomes due and payable when the last borrower moves out of his or her home permanently. For instance, moving into a nursing home, selling the home, passing away or moving in with childern.

G) What happens if the loan balance becomes greater than the value of the home?

     * The HECM is a non-recourse loan, which means they can never owe more than the house is worth. As HECM borrowers, your parents pay a mortgage insurance premium to the US Department of Housing and Developement who, in turns guarantees that they will never owe more than the value of the home when the loan becomes due and payable.

H) What are the risks my parents would be taking in receiving a Reverse Mortgage?

     * A Reverse Mortgage doesn't affect Social Security or Medicare benifits, though you should check with your tax advisor or counseling agency for advise on your unique situstion. To find out if it impacts other federal or state assistance or medical programs, contact your Reverse MOrtgage lender, tax attorney or counseling agency.

I) Are there restrictions on how my parents can spend their money?

    * You parents can spend their money any way they want. Borrowers have used Reverse Mortgage to pay for education, take vacations, eliminate mortgage and other debt, buy a new car, home improvements and anything else their heart desired.

J) Is ther any information that provides what all the fees will be?

    * The lender is required to provide your parents with the Total Annual Loan Cost, or  "TALC" disclosure, which is required by the Federal Reserve Board. The TALC displays the total transaction costs over the projected life of the loan, which will allow your parents to see all the cost related to the Reverse Mortgage.