If you are retired or preparing for retirement, you may have heard about reverse mortgages—and you may have questions. “Is a reverse mortgage right for me? Can it improve my financial well-being; enhance my retirement? What are the risks, and what’s involved?”
Now you can learn about reverse mortgages firsthand, from one of 1st Mariner Bank's mortgage professionals. Without cost or obligation to you, our representative will explain this innovative option, its benefits and limitations and help you determine if a reverse mortgage is your best option.
The 1st Mariner Bank Reverse Mortgage allows you to benefit from the equity that you have established in your home and use it for whatever you wish with no repayment obligations for as long as you live in the house.
Please contact our Product Information Center at 410-558-3343 or 1-866-362-4500. You can also email your question(s) to us at prodinfo@1stmarinerbank.com.
Reverse Mortgage FAQs
What is a reverse mortgage?
A reverse mortgage is a loan that is secured by the equity in your home. This loan does not have to be repaid until you either sell your home or permanently leave your primary residence.
What types of reverse mortgage products are available?
- Federal Housing Administration (FHA)
- FannieMae
- Cash Account Proprietary
How much am I eligible for?
The amount that you (the Borrower) will be eligible for depends on three factors:
- The age of the youngest borrower (minimum age is 62)
- The value of the home
- Expected interest rate
How can I receive money?
Proceeds from a reverse mortgage can be received in any combination of the following:
- Lump sum
- Monthly payments (your choice of loan advances for a specific period, or for as long as you live in your home)
- Line of credit
- Or a combination of all three
What are the “out-of-pocket” costs?
Typically there is only one out-of-pocket expense, the cost of the appraisal. (Other loan costs may be financed with your reverse mortgage.)
Reverse Mortgage Facts
- A reverse mortgage loan does not become due and payable until the last surviving borrower dies, sells the home, or permanently leaves the primary residence.
- The homeowner must continue to pay the property taxes and homeowner insurance, as well as maintain proper upkeep of the property. (Taxes and insurance can be paid out of the loan proceeds if so desired.)
- At the time the loan becomes due and payable, your heirs can choose to either repay the loan (through refinancing, life insurance, etc.) and keep the house, or sell the house to repay the loan.
You and your heirs will receive all remaining equity if any exists after the sale. Since the reverse mortgage is a non-recourse loan, you or your heirs will never owe more than the amount for which the home is sold, even if there is not sufficient equity to pay off the loan.
You will be required to attend a counseling session approved by HUD (Department of Housing and Urban Development) prior to applying for your reverse mortgage.
Common Myths about Reverse Mortgages
The lender will own your home.
False.
You will retain ownership of your home. The lender does not take control of the title. The lender's interest is limited to the outstanding loan balance.
The lender cannot wait for me to “get out of my house” so the lender can be repaid.
False.
Reverse mortgage lenders are not in the business of selling houses. However, they are in the business of helping you keep your home and meet whatever financial needs you may have in order to help you maintain financial independence. Reverse-mortgage borrowers may remain in the home for as long as they wish. However, should they decide to sell the home for any reason, the loan would then become due and payable up to the amount for which the home is sold.
My heirs will be responsible for my loan.
False.
The reverse mortgage is a non-recourse loan. This means that the lender can only derive repayment of the loan from the proceeds of the sale of the property. Your heirs will not be responsible for the repayment of the loan beyond the sale amount.