Call your Countrywide Reverse Mortgage Solutions Advisor today.
1-800-959-3789
The Basics: Questions and Answers
Q. What is the age qualification for a reverse mortgage?
A. Reverse mortgages are for homeowners at least 62 years of age.
Q. Is it possible to get a reverse mortgage if there is already an existing mortgage on the home?
A. Yes, but any existing mortgage must be paid off when the reverse mortgage closes. The funds from the reverse mortgage can be used for that purpose.
Q. Are there any types of homes that do not qualify for a Countrywide reverse mortgage?
A. The property must be your primary residence. Typically, vacation homes or other secondary residences, rental properties, or more than four dwelling units are not eligible. But speak with your loan specialist for the most current eligibility guidelines. Mobile or manufactured homes may be eligible depending on loan product.
Q. Does a home in a "living trust" qualify for a reverse mortgage?
A. In most cases, the answer is yes. As a part of the loan process, you will need to provide a copy of the trust or a Certification of Trust for review by the lender and title company.
Q. Is there any tax liability for the reverse mortgage proceeds?
A. No, funds received from a reverse mortgage are generally categorized as loan advances and not taxable income. Consult your tax advisor for more information.
Q. Can the interest charged on loan principal be deducted for tax purposes?
A. The interest that accrues on your loan is generally deductible when the loan is repaid, which occurs when the last borrower permanently leaves the property. Consult your tax advisor for more information.
Q. How do the proceeds from a reverse mortgage affect Social Security, Medicare or pension benefits?
A. The benefit from a reverse mortgage typically does not affect these benefits. Consult your financial advisor or local senior agency for more information.
Q. Will a reverse mortgage affect SSI or Medicaid benefits?
A. Generally a reverse mortgage will not affect these or most other means tested benefits as long as the monthly cash advances are fully spent every month and not accumulated. However, programs do vary by state, so we strongly encourage you to confirm with your local senior services agency that your benefits will not be affected.
Q. What are the costs associated with a reverse mortgage?
A. Depending on the reverse mortgage program you choose, you may pay an origination fee, a mortgagee insurance fee and actual closing costs, including charges by the title and/or escrow companies. All of these costs can be financed as part of the initial loan advance. (For more information, see the Loan Costs section. You will also receive disclosures of these costs as part of the loan process.) It is also customary for the lender to collect a deposit for the appraisal at the time of application. This is the only lender fee you will be required to pay out-of-pocket.
Q. What is the amount owed when repayment is due?
A. You must repay the money that you have received plus accumulated interest and service fees (when applicable) up to the appraised market value of the home. The repayment is generally due within 6 months of the maturity event.
Q. Can I owe more than my home is worth?
A. A reverse mortgage is a "non-recourse" loan, which means that you, your heirs, or your estate cannot be required to repay more than the appraised market value of the home at the maturity of the loan. If the loan balance exceeds the value of the home, you, your heirs, or your estate will only be obligated to repay an amount up to the current appraised value of the property.
Q. Does the lender take the title of the home?
A. A reverse mortgage is only a lien against the property; therefore, the title will stay in your name.
Q. If there are no monthly mortgage payments, am I responsible for any other expenses related to the home?
A. You are required to pay your property taxes, homeowners and flood (if required) insurance premiums, and other expenses necessary to maintain the home.
Q. When does the loan need to be repaid?
A. Loan repayment is triggered when the home is sold or is no longer occupied as your primary residence. In a case of more than one borrower, repayment is triggered when the last borrower permanently moves out. Until one of these events take place, the last borrower may live in the home and not make any monthly mortgage payments to the lender.
Q. Will my heirs have to sell the property to repay the loan?
A. No, the loan can be repaid by refinancing the existing reverse mortgage with a standard mortgage loan.
Q. How will a reverse mortgage affect the future sale of the home?
A. The impact of a reverse mortgage is no different than that of a purchase or refinance mortgage. Repayment of the mortgage is due upon sale of the home.
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Getting a Loan To speak with a Countrywide Reverse Mortgage Solutions Advisor, call 1-800-959-3789.
Contact a Specialist 1-800-959-3789
http://www.countrywiderm.com/basics/faq.aspx
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Countrywide Bank, FSB and Countrywide Home Loans, a Division of Countrywide Bank, FSB are Equal Housing Lenders. © 2008 Countrywide Financial Corporation. Trade/service marks are the property of Countrywide Financial Corporation and/or its subsidiaries. Countrywide Home Loans, Inc. is headquartered at 4500 Park Granada, Calabasas, CA 91302. Arizona Mortgage Banker License Number BK8805; Licensed by the Department of Corporations under the California Residential Mortgage Lending Act; Georgia Reg. #5929; Illinois Residential Mortgage Licensee; Massachusetts Mortgage Lender License No. ML 1623; this is not an offer to enter into an interest rate lock-in agreement under Minnesota law; Licensed by the New Hampshire Banking Department; New Jersey (818) 313-6526, Licensed Mortgage Banker, NJ Department of Banking and Insurance; Licensed Mortgage Banker, NYS Banking Department; Registered with the Pennsylvania Banking Department; Rhode Island Lender’s License. Some products may not be available in all states. This is not a commitment to lend. Restrictions apply. All rights reserved.
