A reverse mortgage allows homeowners 55 and older to access a portion of their home equity without making monthly mortgage payments. You keep the title to your home. You stay in your home. The loan is repaid when you sell, move out, or pass away, and because it's a non-recourse loan, you or your heirs can never owe more than the home is worth at that time.

How Does a Reverse Mortgage Work?

There are three ways to receive funds: a lump sum at closing, a line of credit that grows over time if unused, or monthly payments directly to you. Most North Idaho homeowners we work with use a combination depending on their retirement income needs and estate planning goals.

Three Ways Trinity Asset Group Uses Reverse Mortgages

Retirement Income. Eliminate your monthly mortgage payment and access your equity as a lump sum, a line of credit, or monthly payments. Proprietary programs are available starting at 55. The government-backed HECM starts at 62.
Home Purchase. Buy a new primary residence with no monthly mortgage payment required. You bring a down payment, typically 45 to 62 percent of the purchase price depending on your age and current interest rates, and the reverse mortgage covers the rest. This is called a HECM for Purchase, and it's one of the most underused retirement tools available.
Estate Planning. Structure a reverse mortgage to preserve assets, protect heirs, and support your family's long-term goals. The standby line of credit grows over time if unused, and financial planners and estate attorneys across the Spokane and Coeur d'Alene area are increasingly building this into retirement income plans.

What changed in 2014

Reverse mortgages have a complicated history. Before 2014, some products had real problems. Spouses were displaced. Heirs were caught off guard. Terms were predatory. HUD's 2014 reforms addressed those issues directly.

Today's HECM requires HUD-approved counseling before closing. Eligible non-borrowing spouse protections are in place. The non-recourse guarantee means your heirs can never owe more than the home is worth at the time of sale.

If someone in your life has told you reverse mortgages are a bad idea, ask them when they last looked at one. The product is fundamentally different today.

Chuck Crites has been originating loans in Idaho since 1987. He works all three reverse mortgage lanes, retirement income, home purchase, and estate planning, and partners directly with financial planners and estate attorneys across North Idaho and the Spokane area. If you or your parents are 55 or older and own a home, a 30-minute conversation costs nothing.

Call (208) 425-8999 or schedule a free consultation at idalender.com.

What is a Reverse Mortgage, and is it right for you?