Update on COVID-19

Finance of America Reverse LLC (“FAR”) understands you may be facing unique hardships during this difficult time. Many borrowers who are currently experiencing financial distress related to COVID-19 may be eligible for some type of assistance. Please contact us for information regarding options that may be available to you. If you are impacted by COVID-19, please call 866-654-0020 and have your loan number ready for the Customer Service representative.

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Have you decided that you are ready to apply for a reverse mortgage? Before you complete your application, you will first you will need to take a few preliminary steps, starting with a mandatory financial assessment to make sure you are financially able to meet your loan obligations.*

To get ready for the financial assessment, you should first talk to a reverse mortgage lender to learn how the assessment will be conducted as well as the documentation you will be required to provide.

Gathering the paperwork

To move the process along, it’s helpful to gather all of the proper documents together in one place before you meet with a loan originator. You will need to locate and document financial records.

  1. Proof of income. Collect pay stubs, W2 forms and if you’re retired, any other documentation of income in retirement. This could include documentation for Social Security (if you’re collecting it), pension details, or 1099 forms for any contract work.
  2. Asset information. You will be required to provide all information from checking and savings accounts, independent retirement accounts (IRAs) or any other investment accounts you may have.
  3. Chronological list of all of your debts. This includes mortgage information, auto loans, credit card debt and anything else with fixed terms and payments.

Safety through financial assessment

The financial assessment is a safety measure in the borrower’s best interest. Because borrowers are still required to pay property taxes, insurance and various other payments for the upkeep of your home, the assessment and documentation helps ensure the borrower does not end up in a poor financial situation as a result of the loan.

The financial assessment also helps to determine whether the lender must set aside a certain amount of money to pay for property taxes and other expenses over the course of the loan. The “set aside” reduces the amount of loan proceeds available to the borrower.

If you would like to learn more details about financial assessment, please contact a Finance of America Reverse mortgage professional today!

*The home must be the primary residence and the homeowner must live in and continue to maintain property charges including property taxes, fees, hazard insurance and maintain the home. If the borrower does not meet these loan obligations, then the loan will need to be repaid.

This article is intended for general informational and educational purposes only, and should not be construed as financial or tax advice. For more information about whether a reverse mortgage may be right for you, you should consult an independent financial advisor. For tax advice, please consult a tax professional.