A reverse mortgage is a home equity loan designed specifically for the needs of older adults. It's called a reverse mortgage because unlike a forward mortgage, where you make payments, a reverse mortgage pays you.

In fact, one of the greatest benefits is that you do not have to make loan payments for as long as you live in your home. With a reverse mortgage, you can turn the value of your home into cash without having to move or to repay a loan each month.

Reverse mortgages typically require no repayment for as long as you - or any co-owner(s) - live in your home. So they differ from other home loans in these important ways:

• You don't need any income to qualify for a reverse mortgage
• You don't have to make monthly repayments on a reverse mortgage
• You can receive additional monthly income
• You are fully insured and protected against owing more than your home value
• You can never lose your home as long as you maintain the property and pay the property taxes

The loans are safe and secure because they are insured by the federal government through HUD/FHA. Additionally you continue to own and maintain full control over your home. With a reverse mortgage, your home title remains with you.

To qualify, there are only a few requirements:

• You, and any other owners of your home, must be aged 62 or over, live in your home as a principal residence, and not be delinquent on any federal debt.
• You must be a homeowner and have enough equity to qualify for the program.
• Your home must be a single-family residence in a 1- to 4-unit dwelling, or part of a planned unit development (PUD) or a HUD-approved condominium; some manufactured housing is eligible, but cooperatives and many mobile homes are not.
• Your home must meet HUD's minimum property standards, but you can use the HECM to pay for repairs that may be required.
• You must discuss the program with a counselor from a HUD-approved counseling agency.

Reverse Mortgage Benefits

Thousands of people each month improve their lives by taking advantage of a reverse mortgage to increase their monthly income.

• Eliminate debt - pay off mortgages or credit cards
• Ease worries by having extra cash available to spend each month
• Access extra cash to renovate or remodel your home
• Create that dream kitchen or bathroom (or both) you've always wanted
• Have extra money to travel

The Easy 9-Step Process

At CAY FINANCIAL, we make obtaining a reverse mortgage easy for you by streamlining the process and being flexible - you never have to leave your home at any time.

Here's the Easy 9-Step Process:

1. Application - During the in-house consultation, your expert Reverse Mortgage Advisor will explain all the features, costs and payment options, and help you determine if this is right for you. If you'd like to proceed, we'll begin the application process.
2. Counseling - We can assist you with setting an appointment to talk to an independent, HUD certified counselor. This is an FHA requirement that provides you with additional peace of mind.
3. Loan Processing - You will be assigned a dedicated Loan Processing Specialist, who will work closely with you. She will be available at any time to provide updates, and you can expect a set, weekly status call to stay in touch.
4. Appraisal/Inspection - We'll set up appointments for the appraisal and possible pest inspection. We'll let you know when they're coming, and all you have to do is be there to let them in.
5. Underwriting/Approval - We submit the loan package to the lender and FHA for approval. We track the entire loan package through the system and keep you informed of its status. If at any point you have questions in between your weekly status calls, just call your Processor.
6. Conditions - Once your file has been approved, your Processor may need to provide further documents or information to underwriting before she can schedule your signing.
7. Cash Disbursement Decision - This step is where you get to make the decision about whether to receive a lump sum, line of credit, monthly payments or a combination.
8. Signing - A document signing with a Notary Public is scheduled in your home.
9. Funding and Recording - Your loan is recorded and you can begin receiving funds.

We want you to be well-informed without feeling overwhelmed. That's why your Advisor and Processor will handle all the details from start to finish. But if you have any questions at any time, they will be glad to answer them for you.

Why use a reverse mortgage?

We know that you want to protect your loved ones, and that means making sure that no one takes advantage of them or their hard-earned assets. At CAY FINANCIAL, we, too, want to protect our clients. Here are a few things you should know about reverse mortgages.

• Get peace of mind - Reverse mortgages are protected by the government, and there are a number of safeguards in place to shield seniors from predatory lending practices. More than 150,000 Americans have benefited from reverse mortgages. Your loved ones likely could benefit, as well.
• Children/Caregiver involvement - Many seniors rely on the advice and counsel of children or caregivers for financial decisions. Liberty Reverse Mortgage strives to include them in the information sharing and application process whenever possible to ensure the right decisions are made.
• Safeguards - The federal government has included several safeguards in the reverse mortgage program to protect senior consumers. Chief among them is the mandate that a third-party counseling session occur with an AARP or HUD-approved counselor before an application can be processed. Another important protection is that an application must be taken in person to avoid phone or mail scams.
• Tap into home equity - A reverse mortgage offers your parents or loved ones a way to tap built-up home equity without selling the home or making payments on a home equity loan. Instead, a reverse mortgage provides cash up front, with no payments due on the loan until the borrowers move out or pass away.
• Keep the title - Reverse mortgages are insured and regulated by the Federal Housing Administration. Seniors who qualify for a reverse mortgage keep the title to their home. There is no risk of losing the home to the lender, and your parents or loved ones will never owe more than the home is worth. And seniors can still bequeath their homes to anyone they wish. Family members can sell the home to repay the reverse mortgage, take out a traditional mortgage or use other funds to pay off the reverse mortgage. Regardless, the title to the home is never in jeopardy.
• Repay at anytime - Your parents or loved ones can repay a government insured reverse mortgage in part or in full at anytime without a prepayment penalty.
• Remain in the community - With a reverse mortgage, your parents or loved ones don't have to move out of their beloved home because they can no longer afford the house payments. A reverse mortgage can be used to pay off the existing mortgage and still provide additional cash. This allows seniors to stay in their homes and in the communities to which they've become attached. It also can provide a stream of income to help pay property taxes, which become increasingly burdensome as other expenses rise.
• Gain financial independence - Most seniors worked hard to purchase and maintain their homes. It can be frustrating to face the retirement years on a fixed income, and it can be embarrassing for parents to ask their children for assistance. With a reverse mortgage, your parents can take advantage of their home equity. They can receive funds in one lump sum or as a monthly payment. The money can be used in any way they wish. They can get relief from the worries of debt, or they can take their dream vacation. It's their money. And it's not due and payable until they move out of the home or pass away.
• Purchase a new home - In some cases, your parents or loved ones may want to move to a smaller home or simply relocate to be near you. Some reverse mortgages have a purchase option, which enables someone to purchase a new home and make no mortgage payments as long as they live in that home.
• Tax-free money - Because proceeds from a reverse mortgage are not considered income, typically they will not be subject to income taxes. Please consult a tax professional.
• Social Security, Medicare and Medicaid - Proceeds from reverse mortgages will not affect your parents' Social Security or Medicare benefits because those benefits are not based on the assets of the recipient. However, in the federal Supplemental Security Income program, beneficiaries must keep their liquid resources under certain limits. If you do not spend loan advances in the month received, then such funds are considered part of your liquid resources and may adversely affect your eligibility for SSI. Regulations vary for state-administered programs such as Medicaid, Aid for Dependent Children (AFDC), and food stamps. Therefore, we suggest that you consult a benefits specialist at your local area Agency on Aging or the local offices for these programs to determine how HECM payments may affect your particular situation.