Reverse Mortgage Steps: Understanding the Lending Process

Reverse Mortgage ProcessUnderstanding the steps in the reverse mortgage lending process can be essential to your financial success when you apply for a reverse mortgage. It’s important to know what’s coming up and what to expect so you can make the right decisions for your financial future and the future of your estate. A thorough understanding provides added peace of mind that you’re making good choices when it comes to promoting financial stability.

If you’re considering a reverse mortgage and you have questions or wish to get started, call Consolidated Credit today at 1-855-435-1876 to speak with a HUD-certified housing counselor for free with no obligation. We can help you better understand the reverse mortgage lending process and help you get started once you’re ready.

Step 1: APPLICATION

When you apply, you may be asked to select a payment plan: a credit line, monthly advances (term or tenure), or a combination of a credit line and monthly advances. You may also be asked to select a monthly or annually adjustable interest rate, and to decide if you want your property taxes and homeowner insurance paid directly by advances from your loan. Some or all of these questions may not be asked until later in the process, depending on the lender you choose.

You will need to provide any information required by the lender, including: a photo ID, verification of your Social Security number, a copy of the deed to your home, information on any existing debt (liens) on your home, and your reverse mortgage counseling certificate. You will also be asked to pay a loan application fee, which covers the cost of a home appraisal and a minimal credit check.

Step 2: PROCESSING

Your lender will order an appraisal, title search and insurance, lien payoffs and any other services needed to complete the loan. An appraiser will come to your home to assess its value and physical condition. If the appraiser finds structural defects that require repair, you must hire a contractor to make the repairs before you can qualify for the loan.

Your lender will submit all required information to their underwriting department, which will determine if everything needed to close the loan is correctly completed.

Step 3: CLOSING

When your loan is approved by the underwriting department, a date for closing the loan will be set, and the final loan documents will be prepared. The closing is a meeting where you sign all of your loan documents. It is generally handled by the title company or the lender. Some states require you to retain an attorney to be present at closing.

After closing, you have 3 business days in which you can cancel the loan. When this three-day period is over, loan funds can be paid to you, and can be used to pay off any existing debt on your home. A new lien is placed on your home to secure the reverse mortgage. Your loan is then sent to the servicing department, or to another company that specializes in servicing reverse mortgages.

Step 4: AFTER CLOSING

Unless you have arranged to have your taxes and homeowner’s insurance paid directly from your loan proceeds, you will still be responsible for making these payments. If you do not, the lender can use loan proceeds to make the payments or, if none remain, the lender can make the entire loan due and payable.

The loan servicer will send you your loan advances and periodic loan statements. No repayment will be due until the death or permanent move from the home by the last living borrower, the sale of the home, or anything else that results in the home no longer being the principal residence of at least one borrower. The repayment obligation cannot be greater than the home’s value at the time the loan is repaid.

"We are really proud to recommend Consolidated Credit" Kathleen Cannon, President & CEO of United Way of Broward County. Consolidated Credit Counseling Services, Inc. is pleased to announce our partnership with the United Way as a United Way Chairman’s Circle Organization.

"We are really proud to recommend Consolidated Credit" Kathleen Cannon, President & CEO of United Way of Broward County. Consolidated Credit Counseling Services, Inc. is pleased to announce our partnership with the United Way as a United Way Chairman’s Circle Organization.

All Consolidated Credit counselors are certified personal financial counselors (CFC) We've helped 5 million people get out of debt! Call us today and see what we can do for you.

Consolidated Credit is honored to receive the 2012 Excellence in Financial Literacy Education (EIFLE) Nonprofit Organization of the Year award. The EIFLE awards acknowledge innovation, dedication and the commitment of organizations that support financial literacy education worldwide. See what Consolidated Credit can do for you.

Consolidated Credit is honored to receive the 2012 Excellence in Financial Literacy Education (EIFLE) Nonprofit Organization of the Year award. The EIFLE awards acknowledge innovation, dedication and the commitment of organizations that support financial literacy education worldwide. See what Consolidated Credit can do for you.

The National Industry Standards for Homeownership Education and Counseling are a set of guidelines for quality homeownership and counseling services. Industry professionals who adopt these standards can be trusted to provide consistent, high quality advice.
Click here to learn more.

Consolidated Credit Consulting Services, Inc. has been verified as the owner or operator of the Web site located at www.consolidatedcredit.org. Official records confirm Consolidated Credit Consulting Services, Inc. as a valid business. Call us today and see what we can do for you.

Consolidated Credit is a Certified ISO 9001 company, as verified through Bureau Veritas Certification.

Time tested and customer trusted. Consolidated Credit Counseling Services has been a BBB Accredited Business since 1998 and has a current A+ rating. Call us today and see what we can do for you.

View the Consolidatedcredit.org review status

Time tested and customer trusted. Consolidated Credit Counseling Services has been a BBB Accredited Business since 1998 and has a current A+ rating. Call us today and see what we can do for you.

View the Consolidatedcredit.org review status

Consolidated Credit is proud to be an ANAB accredited member. Accreditation by a recognized and respected body such as ANAB ensures the impartiality and competence of our company. To see what we can do for you, give us a call.

U.S. Department of Housing and Urban Development - HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. Consolidated Credit is proud to be a member of HUD and also part of the Hope Now Alliance.

You can save!

With this amount of debt, you'd pay around $xx.xx on a DMP.

FREE Debt Consultation
VE Interactive