HECM Reverse Mortgages

Leverage your home’s equity to boost cash flow and enjoy the retirement you’ve always dreamt of. At Senior Lending, we offer Home Equity Conversion Mortgages (HECMs) guidance, giving homeowners the versatility and confidence to live on their own terms. 

Overview of the Home Equity Conversion Mortgage (HECM)

HECM stands for Home Equity Conversion Mortgage. It is a smart type of home equity line of credit geared toward helping retirement-aged homeowners gain better control over the repayment of their mortgage.

Essentially, a Home Equity Conversion Mortgage allows you to withdraw a portion of your home’s equity, making it a financially-viable way for people to supplement their retirement funds. With an HECM, you retain full ownership of your home just as you would with a traditional mortgage. However, an HECM has many benefits not present with a traditional mortgage.

Benefits of HECMs

A HECM is one of the most common types of reverse mortgages insured by the Federal Housing Administration (FHA). It allows older homeowners to convert part of the equity in their home into liquid cash they can use to supplement their retirement income, pay for emergencies or address any other part of their lives. Tapping into a home’s value using an HECM offers individuals many advantages, including: 

• Immediate access to cash: HECMs provide various ways to get your hands on your money, including lump sum, term payment or credit line channels. Whichever method you choose, you’ll have the freedom to use your money however you see fit. 
• Maintain total home ownership: This loan allows you to retain complete ownership over your home throughout the term until you move out or sell it. You must still pay your property taxes and homeowners insurance while maintaining the property. 
• Eliminate monthly payments: The HECM loan covers the rest of your existing mortgage, so you’ll never have to worry about payments again. Since the loan isn’t due until you move out, it doesn’t require any sort of monthly payment, although borrowers can opt to submit payments toward interest or principal if desired. 
• Enjoy retirement protection: The money you receive from a HECM loan is free to use however you wish. With a convenient cash flow, you’ll be free to tackle tasks like making home repairs or paying off your credit card debt. 

The HECM Application Process

Wondering what it takes to secure a HECM line of credit?

The entire process takes anywhere from 30 to 45 days to complete and requires a few different steps to get your hands on the cash you need. 

Counseling 

Homeowners must complete a counseling session performed by a federally insured agency. You’ll learn about the loan’s benefits, eligibility requirements, associated costs and more. This appointment ensures you understand the ins and outs of the loan and gives you confidence in making the right decision for your situation. 

Application 

As your reverse mortgage provider, we’ll need some specific information to approve your HECM loan. Some of this information includes your income, assets, debts and credit history. Your HECM advisor will help you gather the required paperwork and complete your application to create a hassle-free process. 

Appraisal 

Having your home appraised is an integral step in the process of securing your reverse mortgage loan. At this step, a professional appraiser will evaluate your home’s value, looking at market price, location, size and condition. 

Underwriting 

With your appraisal report in hand, the underwriter will get to work to review your application. You’ll then receive your loan approval, which means you’re ready to get started with the closing process. 

Closing 

Closing and funding is the last step in the HECM process. A closing agent will visit your home with the loan closing documents, making it easy to authorize the loan and receive your funds. This stage is also when you’ll choose how to access your cash. 

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