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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RESOURCE LIBRARY

Browse on-demand resources and strategies designed to help your clients improve retirement with home equity.

PLAYBOOK

Learn how a reverse mortgage fits in as part of a client’s comprehensive retirement strategy.

  • Improves cash flow
  • Provides flexibility and freedom
  • Protects against downturns
  • Elevates lifestyle
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WEBINAR
Funding Long Term Care and Preserving Income With Home Equity
October 28, 2021 | 11:00 AM PST

Usage Cases

GOAL
Pay for grandchildren's college expenses.
BACKGROUND

Name: Charlene K.

Age: 72

Home Value: $650,000

Potential Loan Amount: $360,000

SOLUTIONS

A reverse mortgage line of credit withdrawing $40,000 per year for 10 years* while retaining home equity.

* Illustration is for financial professional educational purposes only and assumes a borrower age 72 who resides in CT and an adjustable interest rate, with an initial rate of 1.82% (+0.50% MIP), and financed fees of approximately 3.3% of the home value. Rate quote generated on 8/1/2021. Rates are rounded down to the nearest 0.125% and are subject to change.
GOAL
To have income tax-free retirement funds.
BACKGROUND

Name: Martin S.

Age: 62

Home Value: $750,000

Potential Loan Amount: $368,500

Retirement Savings: $1,300,000

SOLUTIONS

A reverse mortgage line of credit on his home to pay the taxes on his Roth conversions, allowing for tax-free growth* and distributions for the rest of his life. His heirs will inherit the Roth income tax-free as well.

* Not tax advice. Consult a tax professional. Illustration is for financial professional educational purposes only and assumes a borrower age 62 who resides in FL and an adjustable interest rate, with an initial rate of 1.82% (+0.50% MIP), and financed fees of approximately 3.3% of the home value. Rate quote generated on 8/1/2021. Rates are rounded down to the nearest 0.125% and are subject to change.
GOAL
To maximize Social Security benefits.
BACKGROUND

Name: Sarah S.

Age: 66

Home Value: $525,000

Potential Loan Amount: $288,225

SOLUTIONS

A reverse mortgage line-of-credit to supplement her cash flow, allowing her to delay taking Social Security and maximize the benefit.

* Illustration is for financial professional educational purposes only and assumes a borrower age 66 who resides in GA and an adjustable interest rate, with an initial rate of 1.82% (+0.50% MIP), and financed fees of approximately 3.4% of the home value. Rate quote generated on 8/1/2021. Rates are rounded down to the nearest 0.125% and are subject to change.

Stay up to date

Client Opportunity Assessment
Worksheet
Simple questions to help you and your client evaluate if a reverse mortgage may be right for them.
Download PDF
The Boomer Effect: How Will So Many Seniors Get Long-Term Care?
Article
Industry expert Phil Walker explains how using a reverse mortgage as a standby line of credit can address the growing gap between medical insurance and long-term care.
Read Article
Credit and Home Equity Model Language for Financial Service Firms
Article
Insights from the Academy for Home Equity in Financial Planning at the University of Illinois on how prudent use of home equity can help secure a better retirement.
Read Article
Frequently Asked Questions
Below are some frequently asked questions to help clients better understand the option of a reverse mortgage:
Does the borrower still own their home?

Yes. The borrower still retains ownership of the home and may sell it at any time with no prepayment penalties. The home is simply secured with a lien similar to a traditional mortgage or home equity line of credit.

Are there any required payments?

There is never a required principal or interest payment during the life of a reverse mortgage loan. Homeowners are still required to pay property-related expenses, including taxes, insurance, and HOA fees.

When is the loan due?

Generally, the loan balance is due after the last borrower permanently moves from the home or passes away.

What happens when the borrower passes away?

The borrower’s heirs may sell the home and keep any remaining equity if they wish, or refinance with a traditional mortgage if they want to retain the property. In the event the loan exceeds the value of the property, the heirs can choose to walk away via foreclosure with no responsibility to the remaining balance.

Are reverse mortgages non-recourse?

Yes, reverse mortgages are non-recourse loans, which means the lender can only look to the subject property for satisfaction of the mortgage lien. The borrower and/or heirs are never personally liable for satisfaction of the reverse mortgage.