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Reverse Mortgages

What You Need To Know

If you are facing a financial emergency, and all owners of the home are at least age 62, then consider a reverse mortgage.  Otherwise, if you can make the monthly repayments on a home equity loan or line-of-credit, these alternatives are much less costly over the life of the loan.  Consider all available options very carefully before deciding whether a reverse mortgage is necessary.  When dealing with legal issues it is always recommended that borrowers consult an attorney for legal advice.  If you cannot afford an attorney call 1-866-Law-Ohio (1-866-529-6446) or visit OhioLegalServices.org for your closest legal aid office.

 
  • What is a Reverse Mortgage? 

    A “reverse” mortgage is a loan against your home that you do not have to pay back for as long as you continue to live in the home.  A reverse mortgage allows you to borrow against the equity in your home, which is the portion of the value of your home that you have paid for, without having to repay the loan each month.


  • No Credit Check - No Monthly Payments
     

    With the typical reverse mortgage, you don’t have to pay any of the loan back until you die, sell your  home, or don't live in the home for one year.  To qualify for a reverse mortgage, all owners of the home (those named on the deed) must be at least 62 years of age.  Because there are no monthly reverse mortgage payments, you can have almost zero income and still qualify for a reverse mortgage.  Another plus is that the lender can only seek loan repayment from the value of the home.  In other words, the lender cannot sue anyone for a deficiency judgment if the value of the home is not enough to pay off the loan.

  • Reverse Mortgages Are Expensive

    Reverse mortgages are more expensive than other loans for several reasons.  Reverse mortgage borrowers generally use the money they get from a reverse mortgage to pay the various fees that are charged on the loan.  The loan fees are then added to the loan balance and are paid back plus interest when the loan is over.  Also the reverse mortgage interest compounds over the life of the mortgage.  Since no monthly payments are made by the borrower on a reverse mortgage, the interest that accrues is treated as a loan advance.  Each month, interest is calculated not only on the principal amount received by the borrower but on the interest previously assessed to the loan.

  • Learn All The Ins and Outs Of Reverse Mortgages
     
    See the Reverse Mortgages - Frequently Asked Questions (FAQs) page for more information.
What is HECM?

The Home Equity Conversion Mortgage

The Home Equity Conversion Mortgage (HECM) is the Federal Housing Administration’s (FHA's) reverse mortgage program.  The FHA is part of the U.S. Department Housing and Urban Development.  The HECM is a safe plan that can give older Ohioans greater financial security.  Many seniors use it to borrow from the equity they have built up in their homes over the years to supplement their Social Security, meet unexpected medical expenses or make home improvements.  The HECM is the only reverse mortgage insured by the U.S. Federal Government and is only available through an FHA approved lender.


Information About HECMs and Other Reverse Mortgages

 

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This website provides general legal information and not legal advice.  The law is complex and changes frequently. 
Before you apply any general legal information to a particular situation, consult an attorney. 
If you cannot afford an attorney call 1-866-Law-Ohio (1-866-529-6446) or visit OhioLegalServices.org for your closest legal aid office.

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