Questions

Can Anyone Get A Reverse Mortgage?

June 30, 2018 /

Can everyone in Portland apply for a reverse home mortgage loan?

Answer:

No. Not everybody in Portland Oregon can apply for a reverse mortgage.

There are specific requirements you need to satisfy to become eligible for a reverse mortgage. The most common type of a reverse mortgage is called a Home Equity Conversion Mortgage (HECM). The Federal Housing Administration (FHA), a part of the Department of Housing and Urban Development (HUD), insures HECMs.

Note: This web page has specifics about HECMs, which are the most common kind of reverse mortgage loans used in Portland OR.

To qualify for a HECM:

  • You will have to be a minimum of 62 years old.
  • Your house must be your principal residence.
  • You should own your house in full, or have a low mortgage balance that can be paid off at close of escrow with funds from the reverse home mortgage. There are limitations to how much cash you are able to borrow. So, if you still owe a lot of money on your standard mortgage loan, would likely not qualify for a reverse mortgage loan in Portland.
  • You will need to have the income to pay ongoing property charges such as taxes and insurance, in addition to maintenance and repair expenses.
  • You also have to meet with a HUD-approved counselor to talk about your eligibility, the financial implications of the home loan, and other loan alternatives.

This program mandates that you meet with a HUD-approved reverse mortgage (HECM) counselor in Portland or over the phone to discuss how a reverse mortgage works and how much it will cost you. The counselor must be approved by HUD. The FHA also mandates that your home be in good condition. If your property is poorly maintained, you may have to do the repair before you could get a HECM reverse mortgage in Portland.

When you have a spouse or any other relatives living with you, think carefully with regards to their housing needs before applying for a reverse mortgage. Spouses (or others living with you) may apply together as co-borrowers if all parties are 62 or older. For the majority of couples, this is the best choice if they choose to pursue a reverse mortgage. When spouses are listed as co-borrowers on their reverse mortgage, one spouse can reside in the property even if the other spouse dies or may need to move to a an elderly care facility. Unwed couples, siblings, or others living in the property can also apply jointly as co-borrowers and get the same benefits, so long as all borrowers are over age 62.

Note: In some cases one spouse may not yet be 62, and for that reason won’t qualify as a co-borrower. A non-borrowing spouse might be able to remain in the property after the borrower dies if they qualify as an “eligible non-borrowing spouse.” When your non-borrowing husband or wife turns 62, you may be in a position to refinance the reverse mortgage to include them, but there are expenses associated with refinancing a reverse mortgage in Portland Oregon.