Home Savings of America

Who should NOT get a reverse mortgage?

A reverse mortgage is a good solution for many American seniors but it is not right for everyone. A reverse mortgage is not right for you if you have:

• Low home equity (still owe 70% of home’s value)
• For example, if you own a $100,000 home but still owe $70,000, we do not recommend a reverse mortgage.
• Short time left in home (less than 2 years)
• You wouldn’t buy a house if you planned to move out in just 2 years. The same is true of a reverse mortgage. The closing costs of a reverse mortgage get spread out over time making the reverse mortgage quite inexpensive due to low interest rates. However, in two years there is too little time to spread out the costs.

Program Details

Eligibility Requirements

There are no income, employment, or credit requirements.

• All homeowners must be at least age 62 and occupy the property as their primary residence.
• The home can have an outstanding mortgage (it will be paid off).
• Houses, town homes, condominium units, and some mobile homes and PUDs are eligible. Most co-ops are eligible in New York.
• The home must meet minimum HUD property standards. If not, sometimes repairs can be made after the closing of the reverse mortgage.

How much can be borrowed?

The more your home is worth and the older you are, the more you’ll be able to borrow. Homeowners with properties worth more than $500,000 may benefit from jumbo reverse mortgages since they have no maximum loan limit.

Limits are based on:

• Age of the youngest homeowner
• Appraised value of the home
• County in which the property is located
• Current 1-year US Treasury bond rate
• Whether you choose the FHA/HUD or jumbo program

Cash disbursement options

You can choose to receive any combination of these options:

• Lump sum
• Cash is available immediately
• Term
• Equal monthly payments for a fixed number of months
• Tenure
• Equal monthly payments for as long as at least one homeowner lives in the property
• Line of credit
• A credit line that you can draw upon whenever you wish

Interest Rate

Interest rates are low and are generally comparable to traditional mortgage rates. Rates are set based on the one-year US Treasury Bond Rate. You can choose to have the rate adjusted monthly or annually. Changes in interest rates will have no effect on how much cash is available to you; instead fluctuations in rates cause the loan balance to grow at a slower or faster rate.

• Reverse Mortgage Home Page
• Home Savings Home Page
• What is a Reverse Mortgage?
• What Can Reverse Mortgage Be Used For
• Reverse Mortgage Loan Process
• Common Questions
• Comparing the Tradeoffs
• Home Equity Loan vs Reverse Mortgage


• Who Should Not Get a Reverse Mortgage
• Program Details
• How Much Can Be Borrowed?
• Cash Disbursement Options
• Interest Rates
• Meet Our Reverse Mortgage Team
• Contact Home Savings Of America
• Reverse Mortgage Calculator