Jumbo or Propriatary Reverse Mortgages will be offered in
California, Florida, Hawaii and New Jesery
Condos that don't qualify for HECM are acceptable
The HomeSafe private reverse mortgage will be available on September 2nd, 2014 for homes and condominums in five states and will be rolled out in other states soon. This option will not be available in Nevada although we expect other reverse mortgage lenders to be offering their Jumbo products there in the near future. We've been anxiously awaiting these programs as the FHA Home Equity Conversion Mortgage caps the home value at $625,500 thus limiting the million dollar and above properties. Homeowners who are at least 62 years old, with high value homes, will be able to pay off existing mortgages and eliminate mortgage payments on their jumbo mortgages. They may also be able to get a lump sum of cash.
This is an excellent opportunity for retired homeowners to free up cash that they would normally be making on mortgage payments to use for living expenses and to enjoy retirement more. The private reverse mortgages are similar to the FHA insured plan in that no mortgage payments are required as long as one homeowner is living in the home. Interest charges add or accure on the loan balance resulting in a rising principal balance over time, known as negative amortization. They also carry the non-recourse feature as the home alone stands for the debt. If the loan balance is higher than the home value at a maturity event, that amount is not required to be paid back by the homeowner or heirs.
All of the details have not yet been announced but here is what we know:
- The new private, non-FHA #JumboReverseMortgage called the “HomeSafe,” will be focused on borrowers with high-value homes (above $1 million), with a maximum loan amount slightly more than $2 million.
- It will roll out initially in five states: California, Florida, Hawaii, New Jersey and Texas, with more states anticipated in the coming months
- It will have a fixed interest rate in the high 6% to low 7% range
- LTV or loan to value ratios have not been provided yet - but will be soon!
- Borrower's must draw all funds at closing, there will be no line of credit or monthly payment options
- Non-FHA approved #condos will be eligible
- #ReverseMortgage for Home Purchase will be available and seller concessions will be allowed.
- Older borrowers will receive more funds than younger borrowers
- By Maggie O'Connell Call Maggie at 925-784-3286 or 800-684-9438
- Get notified when Jumbo Reverse Mortgage is Available