FAQ – Receiving Money From Reverse Mortgage

What are My Payment Plan Options?

You can choose to receive the money from a reverse mortgage all at once as a lump sum, fixed monthly payments either for a set term or for as long as you live in the home, as a line of credit, or a combination of these.

How Much Money Can I Get?

The amount of funds you are eligible to receive depends on your age (or the age of the youngest spouse in the case of couples), the appraised home value, interest rates, and in the case of the government program, the lending limit in your area.

Can I use the FHA Reverse Mortgage program to finance business or commercial property?

No; the reverse mortgage is only available for use on residential property.

How can I use the proceeds from a reverse mortgage?

The proceeds from a reverse mortgage can be used for anything.

I elected to receive monthly payments, when will those monthly payments start?

Your first monthly payments are to be sent to you the first business day of the month following your loan funding date.

Can I change the type of payment plan I elected at closing?

If you have a Home Equity Conversion Mortgage (HECM), and your loan documents allow for a payment plan change, then yes you can change your payment plan.

What if my loan servicer does not send my requested funds in a timely manner? 

If your servicer does not disburse your funds within these timeframes, then your loan servicer is to pay you a fine equal to 10% of the payment that is due to you, plus interest on that sum for each additional day the disbursement is delayed.

Can I appoint Power of Attorney to handle my reverse mortgage transaction?

Yes. The person listed on the title of the home must be the one to attend counseling, and sign all application and closing documents, unless doctor's note is supplied citing a specific condition which deems the homeowner unable to make their own decisions during this process. A person holding power of attorney can be the main contact for this process.