Fixed Rate Reverse Loans with a Credit Line

Within the last few months several new Reverse mortgage options have become available.  These new HECM’s or “Home Equity Conversion Mortgage” are another way to have the piece of mind knowing the interest rate is fixed and can never change but also offer several payout options to the borrower.

My feeling is, is that these will become the preferred choice for anyone considering a Reverse loan rather than the adjustable rate loan, which traditionally was the only option until recently.

Following is a brief description of each new and unique mortgage.

HECM Choice. The HECM Choice adheres to HUD rules and regulations, but opens possibilities for borrowers by allowing them to take a fixed rate reverse mortgage while accessing some of the proceeds upfront, and the balance of the principal limit through any one of the allowable HECM payment plans—an option not offered under the standard product.

Fixed Advantage. Following the borrower’s upfront draw at loan closing, this fixed rate reverse mortgage allows the borrower to access the full balance of remaining loan proceeds on day 366 following the loan closing.

Fixed Fourtune., The Fixed Fourtune allows borrowers to access their remaining proceeds after a year post-closing, but instead of one payment on day 366, the borrower receives four payments—one in each year post-closing.

Fixed Freedom. The Fixed Freedom offers a fixed rate HECM with all payment options including an open-end line of credit that can be accessed and repaid by the borrower. Live Well’s fixed rate options are all structured as open-ended loans, meaning the borrower can draw down and re-borrow proceeds. Additionally, the traditional HECM credit line growth feature applies

 

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