Applying for a reverse mortgage is normally a quick and easy task; in fact the majority of reverse mortgages go from counseling to completion in 20-45 days. Here’s exactly how the reverse mortgage process works.

STEP 1: Educate Yourself

So you’ve seen the commercial, or an online ad, or somebody told you to look into a reverse mortgage. Your first step is education. Think of why you want to get a reverse mortgage. Is it to get more income, buy a home, or help mom pay for her home healthcare?

Personally, I’m always happy when a senior can tell me about themselves and WHAT THEY HOPE A REVERSE MORTGAGE CAN DO TO HELP THEIR SITUATION.

Then, speak with a reverse mortgage expert. He or she should be able to guide you through both the basics and tell you exactly how a reverse mortgage might work for you. You’ll learn if you are in fact eligible(because NOT everybody qualifies) and help you crunch the numbers.

STEP 2: Counseling

After the first conversation, you might have an idea on if a reverse mortgage is right for you or not. If you like the idea the next step is reverse mortgage counseling. In your counseling appointment; an independent agency licensed by HUD and the FHA(the reverse mortgage governing bodies) will go over your needs, the figures that I(or another reverse mortgage expert) gave you, and tell you your alternatives.

The main goal of counseling Is consumer protection; we want to make sure that you understand how a reverse mortgage will work for you and your responsibilities.

STEP 3: Application Time

The next step is completing an application. Don’t worry, it isn’t binding. On the application you will see the actual proposed numbers(although they are based on a presumed appraised value). If you’d like to move forward you will sign the app and then be eligible for the appraisal.

STEP 4: Appraisal

The reverse mortgage appraisal determines how much your home is worth, and thus how much money you’ll qualify for. There’s lots of confusion on how these appraisals work, so here’s the bottom line.

An appraiser will visit your home, make sure it’s in decent condition(no major health or safety concerns) and compare it to 3 homes in your neighborhood that have sold in the past 6 months(or slightly longer). Once we get the value, I personally call you to inform you of where the home appraised and what it means to your available cash.

STEP 5: Underwriting

Now we have your signed application, counseling’s complete and the appraisal is in. From here our underwriters dot the i’s and cross the t’s. This process can take from 2 days to 2 weeks depending on the complexity of your case. Once underwriting is complete we go to…

STEP 6: CLOSING TIME!

Closing is when we complete the reverse mortgage process. Myself and a notary will visit you with the final documents. You will already know these figures and sign the documents where needed. Then, 4 business days later the loan funds…meaning you get your cash!

I didn’t expect this article to be so long winded, but wanted to give you an accurate portrait of how to apply for a reverse mortgage. Please reach out if you have any questions!