Reverse Mortgage Options for Seniors

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So what is HECM Reverse Mortgage Fixed Rate and is it for you? Home ownership is one of the biggest dreams of many people. Perhaps this is because of the cost savings involved. Some are thrilled at the prospect of making periodic rental payments or the fact that one can use the house as collateral to borrow money when they have financial commitments. For most people in the US, the reverse mortgage loan is one of the methods that seniors can use to obtain some financing.

HECM Reverse Mortgage Fixed Rate

While there are restrictions especially around the age of the applicant, their eligibility, the value and condition of the house amongst others, the process of obtaining the loan is fairly easy especially if one engages counselors and consultants to help them. The Home Equity Conversion Mortgage program provides people with several loans options. For those people that are in need of a large lump sum to take care of a one-off financial commitment, the HECM Reverse Mortgage Fixed Rate is available to them and offers a fixed interest rate on the loan.

The two major types of HECM Reverse Mortgage, the saver and the standard loan. While these two loans are very similar in many aspects, they differ in the amount of money that one is eligible to take out under either of the options. In most cases, one is eligible for between 10 % and 20% less loan under the saver option than the standard loan. Owing to the fact that one qualifies for less money under the saver option, and thus there is less credit risk to the lender, the insurance premium on the saver option is reduced. The save option also results in significant cost-savings and is suitable for people that are expecting to move out of their homes in the near future.

Some people that are still paying their mortgage on the house they live in may decide to take out HECM Fixed Rate Mortgage in order to pay off the mortgage. This loan is also very commonly taken out by people that have a once-off payment. Any money left over after the financial commitment is settled can be used for other purposes. For those people that are not looking to take a large lump-sum, HECM line of credit is a suitable choice for them because it makes the money available to them when they need it.

Before one takes out any of the HECM reverse mortgages, they are encouraged to speak with a consultant who will help them determine their eligibility, the amount that they can take out as well as their financial needs. Depending how the conversation with the consultant goes, one is then able to approach a financial institution and negotiate good HECM Reverse Mortgage Fixed Rate terms for the loan they wish to take.

The Federal Housing Administration insures all HECM loans and this will lead to significant reduction in the initiation costs. While the age requirement of 62 years and above is a prerequisite, it helps to know that one can be eligible even if one has not attained that age as long as his or her legal spouse has attained that age.


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