Your Reverse Mortgage Questions Answered
January 3, 2019
What is a reverse mortgage loan?
Ron: A reverse mortgage allows you to access equity within your home without the obligation of a mortgage payment. You still pay property taxes, insurance, and homeowner association (HOA) dues, if any. The loan and any accumulated interest are eventually repaid when the last surviving borrower permanently departs the home at which time the estate will need to pay off the loan.
Who can qualify for a reverse mortgage?
Ron: To be eligible for a reverse mortgage, a homeowner must be 60+ years of age, own their home outright, or have a qualifying mortgage balance that can be paid off at the closing with proceeds from the reverse loan. And they must occupy the home as a primary residence.
What is the difference between a reverse mortgage and a home equity loan?
Ron: With a second mortgage, or a home equity line of credit, you are required to make monthly mortgage payments. The reverse mortgage can pay you and is available regardless of your current income. (You must demonstrate the ability to pay your current expenses, property taxes, and HOA dues, if any.) The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home or Federal Housing Administration (FHA) mortgage limits for your area, whichever is less. Generally, the more valuable your home is, the older you are, the lower the interest, the more you can borrow. With a reverse mortgage, you cannot be foreclosed upon or forced to vacate your house because you “missed your mortgage payment.”
Passionate about what they do, Alliance offers a wide selection of reverse mortgage loan products and helps you create a personally tailored loan so you feel secure in retirement. If you think a reverse mortgage may be for you, get in touch with Alliance today.
PPP Forgiveness Application Deadline
Congress passed The Economic Aid Act which changed the deferment period from 6 months post covered period to 10 months post covered period. For example, if your covered period ended June 30, 2021, under the new guidelines the earliest your first loan payment wouldn’t be due until April 2022, and you have until then to request forgiveness. Please use the following calculation to help you identify when your forgiveness will be due:
- PPP borrowers may select a covered period anywhere from 8 weeks to 24 weeks.
- RCU is automatically calculating your loan due date based on a 24-week covered period, if you intend on using a shorter covered period please inform us immediately as this will impact your due date.
- Your correct deadline will be reflected in your online banking account.
If all or part of your PPP loan is not forgiven, your first loan payment will be due the first of the following month after a decision is made by the SBA.
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