Call us at 952-942-0110 At Home

Reverse Mortgage: Why Acting Now Will Help You Get the Most Out of Your Home


Beginning in October 2017, there are changes coming to the FHA backed Reverse Mortgage program that could affect the funds available to you from your home. Read on for information on Reverse Mortgages and how to get the most out of your home.

What is a Reverse Mortgage?

A reverse mortgage, or Home Equity Conversion Mortgage (HECM), is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that you've built up over years of making mortgage payments can be paid to you. However, unlike a traditional home equity loan or second mortgage, you don’t have to repay a home equity loan until you no longer use your home as your principal residence – and continue to meet the obligations of the mortgage. You can also use a reverse mortgage to purchase a primary residence if you are able to use cash on hand to pay the difference between the HECM proceeds and the sales price plus closing costs for the property you are purchasing.

What Changes Are Coming?

The Department of Housing and Urban Development (HUD) announced new rules regarding mortgage insurance premiums and Principal Limits Factors. Previously, the mortgage insurance premiums varied based on multiple factors, however, after October 2nd it will be a flat upfront rate of 2.0%. The Principal Limit, or the percentage/amount of money that a reverse mortgage allows borrowers to access from their homes, could be lowered by as much as 20% under the new guidelines. Both of these changes mean that the amount of money available to you will be lower than it is currently.

Looking to the Future

If you have ever thought of taking out a reverse mortgage or are interested in learning more, now is the time. The changes are coming fast, but there is still plenty of time to get the process started and ensure that you are able to complete your reverse mortgage under the current guidelines. The transaction does not need to be closed by October 2nd to qualify under the current guidelines, but you will need to have an established case number, a completed application, and have completed the required HUD counseling by that date. The best way to ensure you get the most out of your home is to contact Cambria® Mortgage™ today and be connected with our Reverse Mortgage team, including Jeff Flanery, our Reverse Mortgage Manager.

Meet Jeff Flanery, CRMP, Cambria Mortgage

Jeff Flanery is a true expert in reverse mortgages. He has been helping people transition to reverse mortgages for over 15 years. “My work is extremely gratifying, as I love helping people extend their nest eggs and live better in retirement,” he says. Since joining Cambria Mortgage more than six years ago, Jeff has earned the title of Certified Reverse Mortgage Professional (CRMP) for his competency and commitment to the highest ethical and professional standards. Bestowed by the National Reverse Mortgage Lenders Association (NRMLA) in Washington, D.C., this prestigious designation is reserved for an elite cadre of mortgage professionals who have completed a stringent set of requirements and passed a rigorous exam and background check.

Call Cambria Mortgage

To get started, call Cambria® Mortgage™ at 952-942-0110 today or visit CambriaMortgage.comOur team of experts will provide personal, hometown service with sound advice and impeccable attention to detail at every step of the process.