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Reverse Mortgages

What is a reverse mortgage?

A reverse mortgage is a home loan (used for any purpose) where seniors, 62 and older, can access the equity (cash) built up in their home.

There are several different reverse mortgage programs. Fannie Mae Home Keeper®, Jumbo Cash-Out loan, and the HUD-insured Home Equity Conversion Mortgage (HECM) are three such programs. As demand increases, more reverse mortgage programs from different organizations will become available.

It is called a reverse mortgage because you borrow money from a lender, but the lender makes monthly payments to you, rather than you making monthly payments to the lender. All interest is paid at the end of the loan, rather than in the beginning.

What are some of the benefits of a reverse mortgage?

Strengthen your personal and financial independence.
Help pay for health care or other needs.
You can never lose your home in foreclosure as long as you maintain the property tax and insurance payments.
The loan is only paid off when the house is sold by you or your heirs, or all borrowers move out of the house.
Keep your Medicare or Social Security benefits.
Use it as a credit line and draw upon it as needed.
Get all your cash right away.
Get the best of both—get cash now and have a balance in reserve to use as a credit line.
No Income Requirements: The homeowner does not need to be working and is not qualified based on income.

As the homeowner receives monthly cash income, the loan balance increases. In the following twelve-month example, the homeowner begins with a debt-free home. As money is received by the homeowner, the mortgage grows. By the end of month twelve, the homeowner owes the bank $6,000 plus $232.44 interest. All Reverse Mortgage loans have a variable rate.

Assumptions*

Regular monthly advances	$500
Annual interest rate	7.0 %
Monthly interest rate	.583% (.07 / 12)

Month	Beginning Balance	Interest	Ending Balance	Cash Disbursement
0	0	0.00	0.00	$500.00
1	$500.00	$2.92	$502.92	$500.00
2	$1,002.92	$5.85	$1,008.77	$500.00
3	$1,508.77	$8.80	$1,517.57	$500.00
4	$2,017.57	$11.77	$2,029.34	$500.00
5	$2,529.34	$14.75	$2,544.09	$500.00
6	$3,044.09	$17.76	$3,061.85	$500.00
7	$3,561.85	$20.78	$3,582.63	$500.00
8	$4,082.63	$23.82	$4,106.44	$500.00
9	$4,606.44	$26.87	$4,633.31	$500.00
10	$5,133.31	$29.94	$5,163.26	$500.00
11	$5,663.26	$33.04	$5,696.29	$500.00
12	$6,196.29	$36.15	$6,232.44	$500.00

*Many criteria are considered when determining the reverse mortgage loan amount, interest rate, etc.

Citylights Financial - 29134 Roadside Drive - Agoura Hills, CA 91301
Office Phone: (800) 530-2489 Fax: (888) 450-7907

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RE/MAX Citylights Estates is an International Network of Independently owned and operated offices offering a variety of real estate and relocations services. RE/MAX Citylights Estates is at 29134 Roadside Dr.suite 107 Agoura Hills Ca. 91301 Citylights Financial Express Inc. and Citylights Commerical Lending Group Inc.is at 29134 Roadside Dr.suite106 Agoura Hills Ca. 91301 Re/MAX Citylights Estates is Lic. by the Ca. DRE #01355798 and Citylights Financial Express Inc. is also Lic.by Department of Corporations #603B921

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