HECM in Beaverton Oregon – Home Equity Conversion Mortgage
What You Need To Be Aware Of With Obtaining A HECM in Beaverton Including, Options, Costs, Requirements and Obtaining The Best Deal
The HECM program makes it possible for elderly homeowners in Beaverton Oregon to pull out a portion of the equity in their home in the form of monthly payments for life or a fixed term, or in a lump sum, or through a credit line. This reverse mortgage loan program allows families to remain in their home while using a portion of its equity. The total income that an owner will get through the program is the maximum claim amount, which is calculated with a formula including the age of the owner, the interest rate, and the value of the home. The borrower remains the owner of the home and may sell it and move anytime, keeping the sales proceeds that exceed the mortgage balance. No repayment is necessary up until the borrower moves, sells, or dies.
How the HECM Program Works in Beaverton Oregon
There are numerous things to consider before determining if acquiring a HECM loan in Beaverton meets your needs. To aid in this process, you will need to meet with a HECM counselor to talk about program eligibility requirements, financial implications and alternatives to receiving a HECM reverse mortgage in Beaverton and repaying the loan. Counselors will go over provisions for the mortgage becoming due and payable. Upon the completion of HECM counseling, you will be capable of making an independent, well informed decision of whether the reverse mortgage will meet your particular needs. You can look online for a HECM counselor or call (800) 569-4287 toll-free.
There is borrower and Beaverton property eligibility requirements that must be met. You may use the list below to determine if you qualify. When you meet the eligibility criteria, you can complete a reverse mortgage application by contacting a FHA-approved lender. You can look online for a FHA-approved lender or ask the HECM counselor to provide you a listing. The loan originator will discuss other guidelines of the HECM program, for instance initial year payment limitations, available payment options, the loan approval process, and repayment terms.
HECM Borrower Requirements Living in Beaverton Oregon
You must:
- Be 62 years old or older
- Own the property outright or paid-down a large amount
- Occupy the home as your principal residence
- Not be delinquent on any federal debt
- Have financial resources to continue for making timely payment of ongoing property charges which include property taxes, insurance and Homeowner Association fees, etc.
- Take part in a consumer information session given by a HUD- approved HECM counselor
Beaverton Property Requirements with the HECM
The following eligible property types in Beaverton must meet all FHA property standards and flood requirements:
Single family home or 2-4 unit home with one unit occupied by the borrower
HUD-approved condo project
Manufactured home that meets FHA requirements
HECM Financial Requirements of Borrowers in Beaverton Oregon
Income, assets, monthly living expenses, and credit ratings will be verified.
Timely payment of real eOregon taxes, hazard and flood insurance premiums are going to be confirmed
For adjustable interest rate mortgages, you could select one of the following payment plans:
Tenure – equal monthly payments provided that at least one borrower lives and continues to inhabit the property as a principal residence.
Term – equal monthly payments for a fixed period of months selected.
Line of Credit – unscheduled payments or in installments, at times and in an amount of your choosing up until credit line is depleted.
Modified Tenure – combination of line of credit and scheduled monthly payments for as long as you live in the home.
Modified Term – combination of line of credit plus monthly payments for a fixed period of months selected by the borrower.
For fixed interest rate home loans, you will receive the Single Disbursement Lump Sum payment plan.
HECM Mortgage Amounts Are Based On the Following
The amount you may borrow is determined by:
Age of the youngest borrower or eligible non-borrowing spouse
Current interest rates; and
Lesser of:
appraised value;
the HECM FHA mortgage limit of $679,650; or
the sales price (only applicable to HECM for Purchase)
Whether there is more than one borrower and no eligible non-borrowing spouse, the age of the youngest borrower must be used to determine the amount you can borrow.
HECM Loan Costs
You can pay for most of the costs of a Beaverton HECM by financing them and having them paid through the proceeds of the loan. Financing the fees means you do not have to pay for them out of your pocket. However, financing the costs decreases the net loan amount available to you.
The HECM loan includes several fees and charges, this includes: 1) mortgage insurance premiums (initial and annual) 2) third party charges 3) origination fee 4) interest and 5) servicing fees. The lender will discuss which fees and charges are mandatory.
You will be charged an initial mortgage insurance premium (MIP) at closing. The initial MIP will be 2%. Over the life of the loan, you will be charged an annual MIP that equals 0.5% of the outstanding mortgage balance.
Mortgage Insurance Premium
You will incur a cost for FHA mortgage insurance. The mortgage insurance guarantees that you will receive expected loan advances. You can finance the mortgage insurance premium (MIP) as part of your loan.
Third Party Charges
Closing costs from third parties can include an appraisal, title search and insurance, surveys, inspections, recording fees, mortgage taxes, credit checks and other fees.
Origination Fee
You will pay an origination fee to pay the mortgage company for processing your HECM loan. A lender can charge the greater of $2,500 or 2% of the first $200,000 of your home’s value plus 1% of the amount over $200,000. HECM origination fees are capped at $6,000.
Servicing Fee
Loan providers in Beaverton or their agents provide servicing throughout the life of the HECM. Servicing consists of sending you account Oregonments, disbursing loan proceeds and making sure that you keep up with loan requirements such as paying property taxes and hazard insurance premium. Lenders may charge a monthly servicing fee of no more than $30 if the loan has an annually adjusting interest rate or has a fixed interest rate. The lender may charge a monthly servicing fee of no more than $35 if the interest rate adjusts monthly. At loan closing, the lender sets aside the servicing fee and deducts the fee from your available funds. Each month the monthly servicing fee is added onto your loan balance. Lenders may also choose to include the servicing fee in the mortgage interest rate.
Shopping for a Home Equity Conversion Mortgage in Beaverton Oregon
If you are thinking about getting a HECM in Beaverton, check around. Determine which type of reverse mortgage loan could be right for you. That could depend on what you want to do with the loan. Evaluate your choices, terms, and fees from various HECM loan providers in Beaverton. Learn as much as you can about reverse mortgages before you speak to a counselor or loan company. And ask plenty of questions to ensure a HECM will work for you – and that you’re obtaining the right kind for you.
Here are some things to consider:
Do you need a HECM to pay for home repairs or property taxes? If so, determine whether you are eligble for any low or no cost grants in your Beaverton. Employees at the Beaverton Area Agency on Aging may know about the programs in your Beaverton. Look for the nearest agency on aging at eldercare.gov, or call 1-800-677-1116. Ask about “loan or grant programs for home repairs or improvements,” or “property tax deferral” or “property tax postponement” programs, and the ways to apply.
Are you living in a higher valued house? There’s a chance you’re able to borrow more money using a proprietary reverse mortgage. But the more you borrow, the bigger the fees you will pay. In addition, you might take into consideration a HECM loan. A HECM counselor or a lender in Beaverton can assist you assess these kinds of loans side by side, to see what you will get – as well as what it costs.
Compare fees and rates. This bears repeating: check around and compare the costs of the HECM loans available to you in Beaverton. Although the mortgage insurance premium is usually the same amongst numerous lenders, nearly all loan costs – including origination fees, interest rates, closing costs, and servicing fees – fluctuate between financial institutions.
Understand total costs and loan repayment. Ask a counselor or lender to explain the Total Annual Loan Cost (TALC) rates: they reveal the predicted annual average cost of a HECM, which include all the itemized costs. And, regardless of the form of HECM you’re thinking about in Beaverton, recognize all the reasons why your loan might have to be repaid prior to were planning on it.
What You Need To Know About HECM Loans in Beaverton Oregon
If you get a HECM of any kind, you receive a loan in which you borrow from the equity in your house. You keep the title to your home. Rather than paying monthly home loan payments, though, you will get an advance on part of your home equity. The cash you will get usually is not taxable, and it generally won’t affect your Social Security or Medicare benefits. Once the last surviving borrower dies, sells the home, or no longer lives in the home as a principal residence, the HECM will have to be repaid. In certain situations, a non-borrowing spouse may be able to continue to live in the home. Here are some things to consider about home equity conversion mortgages in Beaverton Oregon:
You will owe more over time. As you obtain money using your home equity conversion mortgage, interest is added onto the balance you owe each month. Which means the total amount you owe gets bigger as the interest on your loan accumulates over time.
Interest rates can change over time. Nearly all HECM’s have variable interest rates, that are tied to a financial index and change with the market. Variable rate loans normally provide you with more choices on how you get your money through the HECM loan. Some reverse mortgages – mostly HECMs – offer fixed rates, however they tend to require you to take your loan as a lump sum at closing. Usually, the total amount you can borrow is lower than you can get with a variable rate loan.
Interest is not tax deductible every year. Interest on reverse mortgages is not deductible on income tax returns – until the loan is paid off, either partially or in full.
You must pay other costs in connection with your home. In a HECM, you keep the title to your
Beaverton home. This means you are responsible for property taxes, insurance, utilities, fuel, maintenance, as well as other expenses. And, if you don’t pay your property taxes, keep homeowner’s insurance, or take care of your home, the lender might require you to repay your loan. A financial assessment is mandatory when you apply for the mortgage. Because of this, your lender might require a “set-aside” amount to pay your taxes and insurance during the loan. The “set-aside” reduces the amount of funds you can get in payments. You are still responsible for maintaining your home.
What happens to your spouse? With HECM loans, if you signed the loan paperwork and your spouse didn’t, in a few instances, your spouse may continue to reside in the home even after you die if he or she pays taxes and insurance, and continues to maintain the property. But your spouse will stop getting money from the HECM, since he or she wasn’t part of the loan agreement.
What can you leave to your heirs? HECM’s can use up the equity in your home, which implies less assets for you and your beneficiaries. Most reverse mortgages have something called a “non-recourse” clause. Which means you, or your eOregon, can not owe more than the value of your home once the loan becomes due and the home is sold. With a HECM, generally, if you or your heirs need to pay off the loan and retain the home instead of sell it, you wouldn’t have to pay more than the appraised value of the home.
[hide][ssvideo keyword=”what is a hecm” title=””][/hide]
[hide][ssplaces location=”Beaverton Oregon” keyword=”loans” limit=”10″][/hide]
[hide][ssvideo keyword=”home equity conversion mortgage” title=””][/hide]