Home Equity Conversion Mortgages (HECMs) are an increasingly popular way for seniors to supplement their retirement income, offering an option for accessing a portion of the equity accumulated in their home. A HECM loan allows homeowners 62 and older to stay in their homes and convert a portion of their home equity into tax-free loan proceeds.1
No repayment is required as long as the borrower lives in the home as their primary residence, maintains it according to Federal Housing Administration (FHA) requirements, and continues to pay required property taxes and homeowners insurance.
The term reverse mortgage loan may be used to describe a proprietary reverse mortgage loan or a FHA-insured reverse mortgage loan, so be sure to understand the difference.
Only the reverse mortgage loan insured by the FHA is called a Home Equity Conversion Mortgage (HECM). The HECM is only available through a Federal Housing Administration (FHA) approved lender (like Liberty Home Equity Solutions, Inc.) and it comes with borrower safeguards like required reverse mortgage counseling, mortgage insurance, and caps on a majority of fees and some interest rates.
1 Consult your financial advisor and appropriate government agencies for any effect on taxes or government benefits.
Homeowners Obtain HECM Loans To:
Improve their retirement cash flow
- Payoff existing mortgage
- Pay off other debt
Make large purchases for
- Needed home repairs and improvements
- Helping family members
Plan for the future
- Easy access to cash for unexpected emergencies
- Preserve other retirement savings
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