Reverse Mortgage Miami

What if you could take the equity from your home and use it right now as a flexible money source to finance your retirement? If you are 62 years of age, own your own home, and it is your primary residence, you may be able to do that with a Miami reverse mortgage loan.

Use Your Equity Now

A Home Equity Conversion Mortgage, or reverse mortgage, is a mortgage that allows you to borrow against the equity in your home much the same as a second mortgage in Miami but with a few key differences.

Government Insured

Your reverse mortgage is insured by the federal government through the Federal Housing Administration, or FHA. If the amount you owe ever exceeds the value of your home such as in a market downturn, FHA assumes that loss. For that coverage, you pay a mortgage insurance premium as part of the cost of the loan. As part of that government oversight, your closing and servicing fees are also subject to limitations.

Miami Reverse Mortgage Qualifications

As in any other type of mortgage products available today, your Miami reverse mortgage loan has qualification requirements you must meet.

  • You must be 62 years of age or older.
  • The property must be your primary residence and you must be living there. Once you have qualified, you cannot live elsewhere for more than six months for nonmedical reasons or twelve months for medical reasons or you will be required to repay the loan.
  • Your reverse mortgage must be the first mortgage. That means that you must either own your home outright or the reverse mortgage must pay off whatever you owe on your first mortgage.
  • The lender will determine if you have the means to keep up with property taxes, insurance, or monthly maintenance.
  • You must have no federal debt delinquencies.
  • Your property must meet eligibility requirements. If your property is a multifamily property, it can be no more than four units, one of which must be your own primary residence. Manufactured homes or condominiums must meet HUD requirements.
  • Prior to applying with a Miami reverse mortgage company, you are required to meet with a counselor approved by HUD to talk about all the possible consequences of a reverse mortgage.

Spend As You Wish

Once you receive your loan payout, you have the choice of spending it in any way you wish. You can choose to take it in monthly increments, set it up as a line of credit, or take it as a lump sum payout. You maintain full ownership of your home and your lender has no rights to it providing you keep current with all taxes and insurance coverage.

Reverse Mortgage Drawbacks

Although a reverse mortgage loan in Miami has many attractive benefits for retirees, it can also have drawbacks and it is important for homeowners to understand these before embarking on this type of loan.

  • Closing fees — as in all mortgage products, there are certain closing fees involved. These can be built into the loan and not payable until you leave your home but they can reduce the amount of your mortgage proceeds.
  • Your lender charges interest, the same as any other mortgage. The difference is that this interest becomes payable at the sale of the property and reduces the amount you or your heirs will receive upon the sale of the home.
  • Because the interest is paid at the sale, there is no annual deduction allowed for this interest on your annual tax return.
  • If you decide to move to another home or must move from your home for any medical or nonmedical reasons such as assisted living, the loan is due and payable.
  • Your Miami reverse mortgage could reduce the amount that your heirs inherit. In the event of your death, any proceeds from the sale of your home will be required to pay off your reverse mortgage balance. You may wish to discuss this with any potential heirs.
  • The same as any other mortgage product, your lender can foreclose on you if you fail to pay insurance, real estate taxes, or monthly maintenance fees.

For more information about Miami reverse mortgages, call the professionals at Sun Capital Mortgage for a free consultation. We are happy to help you understand reverse mortgages and help you explore if it is the appropriate financial option for you.

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