What Is a Reverse Mortgage?

A Reverse Mortgage is a financial tool, plain and simple.  This tool, combined with your other financial strategies, can allow you to retire when you didn’t think you could, or help you have the security of making your finances last throughout your retirement.  With an estimated 10,000 people turning 62 years old EACH DAY in the United States, there has never been a greater need for an additional financial tool to facilitate a stress-free retirement.

Some important things to know:

  • This specific loan allows a homeowner 62 years or older to access the equity in their principal residence without taking on monthly mortgage payments. *
  • This type of loan, referred to as Home Equity Conversion Mortgage (HECM) is insured by the Federal Housing Administration (FHA) within the U.S. Department of Housing and Urban Development (HUD).
  • The homeowner can access the equity from a reverse mortgage by receiving a monthly income, establishing a line of credit, receiving a lump sum or any combination of the three!
  • You can also use a reverse mortgage to PURCHASE your primary residence!
  • Qualified borrowers may be able to purchase a home without taking on monthly payments. *
  • This type of HECM loan allows a  buyer to bring just enough of a down payment that creates enough equity in the home so that there are no monthly payments. *
  • There is NO Required monthly payment on the HECM loan! In fact, in most cases you can ELIMINATE YOUR MONTHLY MORTGAGE PAYMENT! **

Please see our FAQs for further information on both the HECM for Refinance and HECM for Purchase products.

* No Principle and Interest (P&I) payments required but must pay property taxes and required homeowner’s insurance, maintain proper upkeep of the home and occupy the home as the primary residence

** Repayment of the loan is deferred until the home is sold or the last borrower moves out permanently.

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