What is a HECM and is it the same as a Reverse Mortgage?
A HECM (pronounced heck-um) is a Home Equity Conversion Mortgage, the fancy name for a Reverse Mortgage. It makes sense when you think about it because that's exactly what you're doing—converting your home equity into cash.
If you are a homeowner aged 62 or older, a reverse mortgage can be a helpful tool to help you stay in your home (or even buy a new one) but not worry about having a mortgage payment. You will still be responsible for paying taxes and insurance and for properly maintaining your home. You must use the home as your primary residence.
How does a HECM mortgage work? Take a look at the highlights below.
Program Highlights:
- No payment option available*
- HECMs are federally insured.
- Same products, limits, LTVs, and rates as traditional mortgages
- Excellent planning tool to fund retirement
The Fine Print:
- Must be 62 years old, or older
- Applies only to owner-occupied, primary residences
- Mandatory HUD counseling
- The homeowner is still responsible for property taxes, homeowners insurance, upkeep and any relevant HOA fees.
- *Age-based assessment and other guidelines determine allowable equity ratios. Various payment and draw options available.
Want to see if you qualify for a Reverse Mortgage today? Click here.
If you're interested in exploring the opportunities a HECM may provide you or a loved one, give us a call today. We'll be happy to help. 888-616-9885.
