Steps to Getting Started: Application to Closing

1. Contact a Reverse Mortgage Specialist: Begin by contacting a Reverse Mortgage Specialist. You will receive a free, no obligation consultation so you can examine Reverse Mortgage figures and parameters. Your Reverse Mortgage specialist can make an in home visit or you can meet at their place of business. Discuss all your options and determine if a Reverse Mortgage is right for you. You may want to invite a friend, family member, or financial advisor to the consultation.

number, evidence of homeowner's insurance, info on current mortgages, equity loans, or liens.

5. Appraisal & Title Search: An appraisal of your home will be performed to determine its value. With a Reverse Mortgage a full appraisal is required. An interior and exterior inspection will be conducted, photos of parts of your home (inside and outside) will be taken. The appraiser will compare your home to homes that are similar to yours.

A title search will conducted to determine ownership of your property. Any judgments and mortgages will show on title.

6. Submission of Your Loan to Underwriting: After the appraisal and title is received, your application can be submitted to Underwriting at the lender. Once the Underwriter determines that the home is insurable by FHA and meets the requirements of the lender an approval is issued.

7. Conditions Required By the Lender: There is one more step before your loan is cleared to close: conditions required by the lender. Peeling paint, a broken sidewalk, etc,. must be repaired within six months of your closing date. If there are hazards that pose a danger to the occupants or visitors of the home, immediate repairs will be required. Here are some examples of conditions that may be required to close:

* You paid off your mortgage fifteen years ago, but it still shows up on title as unsatisfied. You will be asked to provide the satisfaction letter you received from your lender when your loan was paid in full. This should clear up the situation.

* Judgments that have been satisfied, but still show up on title require satisfaction of the lien prior to closing. If you have judgments that are unpaid, they will be paid out of your Reverse Mortgage proceeds.

* The appraiser notices evidence of termite infestation. A termite inspection will be required to assess the level of termite infestation and any damage. Treatment, unless severe) can be completed within six months of closing. If there is damage which causes danger to the homeowner, visitors, or affects the integrity of the structure, repairs must be completed prior to closing.

NOTE: Oftentimes there are no conditions required to close.

8. Clear to Close: Your Reverse Mortgage Specialist will inform you when your loan is clear to close. This means all conditions have been satisfied, all the necessary documentation has been deemed acceptable, and your loan can close.

9 Closing: Your Reverse Mortgage Specialist attends your closing along with the bank attorney and the title closer (who is responsible for paying your taxes and current mortgages). Closings generally take about one hour or more.

Right of Rescission: You have three days in which to reconsider and cancel the transaction. This is known as the the "right of rescission" period. (Saturdays are included. Sundays are excluded.)

Funding: You get your money, either by direct deposit into your checking/savings account or by check which can be overnighted to you or it can be picked up at the closing agent's office.
 

2. Independent Reverse Mortgage Counseling: Reverse Mortgage counseling with a HUD approved counseling agency must be completed prior to getting an appraisal of your property. Reverse Mortgage counseling was set up by the Federal Government as a safeguard for borrowers. It is there for your protection and ensures that all your questions are answered.

NOTE: There is nothing to preclude signing an application prior to Reverse Mortgage counseling. Nothing can proceed until HECM counseling is completed.

After your counseling session you will receive a certificate. If counseling is done over the phone the certificate can be faxed to you to expedite the process. (An original will be mailed to you.)

Contact your Reverse Mortgage Specialist to advise them you have completed Reverse Mortgage counseling. You will provide your specialist with the original certificate and retain a copy for yourself.

3. The Reverse Mortgage application: You will review documents, choose a HECM program, and decide how you wish to receive your funds. Then you will sign application documents.

4. Documents required at application signing: Photo ID, verification of social security

Closing Cost Info

HECM for Home Purchases

What About My Heirs?

Reverse Mortgage Safeguards

Different Types of Reverse Mortgages

Reverse Mortgage Counseling

• Free Reverse Mortgage information, call 1-888-843-9797