Jumbo Reverse Mortgage
What is a Jumbo Reverse Mortgage?
Home Equity Conversion Mortgages (FHA-insured) and Jumbo reverse mortgages are the two most frequent types of reverse mortgages on the market today. The former you are most likely familiar with, having seen a number of television commercials with celebrities extolling the virtues of a "reverse mortgage."
Homeowners with higher-valued houses can incorporate their home equity into retirement, giving them access to a far larger portion of their property's value.
Jumbo reverse mortgages are designed for homeowners with higher-valued homes that exceed the government lending limit, allowing them to access a larger portion of their home's value. Typically, those over the age of 55 or 60 with sufficient equity in a higher-value house are suitable candidates for a private jumbo reverse mortgage.
Jumbo Reverse Mortgages have the following key features:
While Jumbo reverse mortgages are similar to standard reverse mortgages, they differ for a variety of reasons. One of the most striking characteristics is that many jumbo reverse loans have loan amounts of up to $4 million. Furthermore, some lenders consider property values up to $10 million. Another advantage of these private mortgages is that they do not require the costly FHA mortgage insurance premiums required on the regular Home Equity Conversion Mortgage-one of the most substantial closing fees and ongoing payments on a typical reverse mortgage.
In contrast to a regular federally-insured reverse mortgage, which is controlled by HUD and guaranteed by the Federal Housing Administration, a jumbo reverse mortgage is a private or proprietary loan in which the lender controls the loan's terms, conditions, and guarantees.
Here are some of the features of today’s jumbo reverse mortgages (features and benefits vary by the issuing bank and jumbo loan product chosen).
Loan amounts to $4,000,000
Property Values to $10,000,000
No first year distribution limitations
Flexible disbursement options
¹This advertising is not intended to provide financial advice. Regarding your specific situation, please consult a financial expert. Certain events will cause the loan to mature and the balance to become due and payable. Borrowers must continue to pay property taxes, homeowner's insurance, and keep the property up to HUD standards. Failure to do so may result in the debt becoming due and payable. Credit is conditional on age, income, credit history, and property qualifications. Rates, fees, terms, and conditions for the program are not available in all states and are subject to change
.²Borrowers should seek professional tax guidance on the proceeds of a reverse mortgage.
This material is not provided by, nor was it approved by, the Department of Housing & Urban Development (HUD) or by the Federal Housing Administration (FHA). It is not intended to be a substitute for legal, tax, or financial advice. Consult with a qualified attorney, accountant, or financial advisor for additional legal or tax advice.
*There are some circumstances that will cause the loan to mature and the balance to become due and payable. The borrower(s) must continue to pay for property taxes and insurance and maintain the property to meet HUD standards or risk default. Credit is subject to age, minimum income guidelines, credit history, and property qualifications. Program rates, fees, terms, and conditions are not available in all states and subject to change.
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