AFC Reverse Mortgages
Reverse Mortgages ExplainedWhat if there were no payments due on your home equity loan unless or until you sold or moved out of your home (even if it meant not having to make any mortgage payments for the rest of the time you remain in your home)? What if you could receive regular monthly advances from that same home equity loan for the rest of the time you remain in your home with no limit on the amount you receive (even if the amount you receive eventually exceeded the value of your home)? What if, should the loan balance eventually exceed the value of your home, you could continue to receive monthly payments or tap your line of credit and you or your heirs would not have to pay back more than what the house would sell for on the open market?
What you’d have is a reverse mortgage; a loan that can offer monthly advances for the rest of the time you remain in your home, but that requires no mortgage payments for life (so long as you live in and own your home), and where there are no mortgage payments to miss because there are no mortgage payments to make. The perfect loan for seniors. With no mortgage payments to make there are no income requirements or limitations, so any homeowner age 62 or older can qualify. HECM closing costs such as title insurance, origination fee and FHA insurance can be included in the reverse mortgage balance, so there is no cash required at closing. A reverse mortgage is a source of additional tax free income (because it is a loan) that can be used to pay the costs of maintaining a home, to pay bills and taxes or to pay off an existing mortgage, to pay for insurance, take a trip, or visit the grandchildren, or even to buy a new home, all without any obligation to make monthly mortgage payments. In addition to the option of receiving monthly payments for life a reverse mortgage can also be funded as a lump sum, as a line of credit, or as monthly payments for a fixed term. As a consumer protection, Federal law requires counseling with an independent third party counselor before obtaining a FHA reverse mortgage loan. Counselor lists are available online from FHA or can be obtained from a reverse mortgage lender.
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Mr. & Mrs. Kerns of Whitehall, Pennsylvania How it works: Home value: $118,000, Qualified for lump sum of $70,655 or monthly income for life of $454. They combined reduced lump sum of $30,000 with reduced monthly income of $254. Mrs. Kerns: “We’re thrilled. We tell everyone about it. It’s completely changed our lives.”
The homeowner retains title to the property and can choose to sell the home at anytime. 
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