FHA Reverse Mortgages (HECMs) for Seniors in John Day Oregon
IN TODAY’S DIFFICULT ECONOMIC TIMES, PEOPLE WANT MORE OPTIONS!
Are finances a little tight? Is it getting tougher to make that house payment? Are you worried about the future & need your peace of mind back? Have you experienced events that created a financial loss? For a long time no one in John Day knew what a Reverse Mortgage was. Now, they are the talk of the town and popular as seniors are enjoying a loan with NO monthly mortgage payment ever due and if there are proceeds received, they are tax-free. This is helping many deal with life right now!
However, Reverse Mortgages are complex and require further explanation by a person with experience. My goal is to provide in-depth facts, explaining the pros and cons about all of the Reverse products, in order for each individual to determine if a reverse is the right option. Preferably, a face-to-face appointment (no obligation) is best. You deserve the time spent. I will provide information by mail, email and yet again I stress, it is best understood in person. Your home is usually your largest asset and I take that to heart as I educate you.
Reverse Mortgages are great for many people in John Day, but they are not for everyone.
Is it right for you? Call me and let’s find out! We can meet whenever and wherever you want (my office, your home, for your convenience). Most information I can give you on the phone, too – or by Fed Ex, Email as well. And, again, there is no-obligation, even if we have a face-to-face meeting!
If you are a homeowner age 62 or older and have paid off your mortgage or paid down a considerable amount, and are currently living in the home, you may participate in FHA‘s Home Equity Conversion Mortgage (HECM) program. The HECM is FHA’s reverse mortgage program in John Day enables you to withdraw a portion of your home’s equity.
You can also use a HECM to purchase a primary residence if you are able to use cash on hand to pay the difference between the HECM proceeds and the sales price plus closing costs for the property you are purchasing.
Video: What is reverse mortgage and how it can help
How the Program Works
There are many factors to consider before deciding whether a HECM is right for you. To aid in this process, you must meet with a HECM counselor to discuss program eligibility requirements, financial implications and alternatives to obtaining a HECM and repaying the loan. Counselors will also discuss provisions for the mortgage becoming due and payable. Upon the completion of HECM counseling, you should be able to make an independent, informed decision of whether this product will meet your specific needs. You can search online for a HECM counselor or call (800) 569-4287 toll-free.
There are borrower and property eligibility requirements that must be met. You can use the listings below to see if you qualify. If you meet the eligibility criteria, you can complete a reverse mortgage application by contacting a FHA-approved lender in John Day OR. You can search online for a FHA approved lender or you can ask the HECM counselor to provide you with a listing for someone in John Day. The lender will discuss other requirements of the HECM program, such as first year payment limitations, available payment options, the loan approval process, and repayment terms.
John Day Borrower Requirements
- Be 62 years of age or older
- Own the property outright or paid-down a considerable amount
- Occupy the property as your principal residence
- Not be delinquent on any federal debt
- Have financial resources to continue to make timely payment of ongoing property charges such as property taxes, insurance and Homeowner Association fees, etc.
- Participate in a consumer information session given by a HUD- approved HECM counselor
John Day Property Requirements
The following eligible property types in John Day must meet all FHA property standards and flood requirements:
- Single family home or 2-4 unit home with one unit occupied by the borrower
- HUD-approved condominium project
- Manufactured home that meets FHA requirements
Financial Requirements For A Reverse Mortgage
- Income, assets, monthly living expenses, and credit history will be verified.
- Timely payment of real estate taxes, hazard and flood insurance premiums will be verified
For adjustable interest rate mortgages, you can select one of the following payment plans:
- Tenure – equal monthly payments as long as at least one borrower lives and continues to occupy the property as a principal residence.
- Term – equal monthly payments for a fixed period of months selected.
- Line of Credit – unscheduled payments or in installments, at times and in an amount of your choosing until the line of credit is exhausted.
- Modified Tenure – combination of line of credit and scheduled monthly payments for as long as you remain in the home.
- Modified Term – combination of line of credit plus monthly payments for a fixed period of months selected by the borrower.
For fixed interest rate mortgages, you will receive the Single Disbursement Lump Sum payment plan.
Reverse Mortgage Amount Based On
The amount you may borrow will depend on:
- Age of the youngest borrower or eligible non-borrowing spouse
- Current interest rate; and
- Lesser of:
- appraised value;
- the HECM FHA mortgage limit of $679,650; or
- the sales price (only applicable to HECM for Purchase)
If there is more than one borrower and no eligible non-borrowing spouse, the age of the youngest borrower is used to determine the amount you can borrow.
You can pay for most of the costs of a HECM by financing them and having them paid from the proceeds of the loan. Financing the costs means that you do not have to pay for them out of your pocket. On the other hand, financing the costs reduces the net loan amount available to you.
The HECM loan in John Day includes several fees and charges, which includes: 1) mortgage insurance premiums (initial and annual) 2) third party charges 3) origination fee 4) interest and 5) servicing fees. The lender will discuss which fees and charges are mandatory.
You will be charged an initial mortgage insurance premium (MIP) at closing. The initial MIP will be 2%. Over the life of the loan, you will be charged an annual MIP that equals 0.5% of the outstanding mortgage balance.
- Mortgage Insurance Premium
You will incur a cost for FHA mortgage insurance. The mortgage insurance guarantees that you will receive expected loan advances. You can finance the mortgage insurance premium (MIP) as part of your loan.
- Third Party Charges
Closing costs from third parties can include an appraisal, title search and insurance, surveys, inspections, recording fees, mortgage taxes, credit checks and other fees.
- Origination Fee
You will pay an origination fee to compensate the lender for processing your HECM loan. A lender can charge the greater of $2,500 or 2% of the first $200,000 of your home’s value plus 1% of the amount over $200,000. HECM origination fees are capped at $6,000.
- Servicing Fee
Lenders or their agents in John Day provide servicing throughout the life of the HECM. Servicing includes sending you account statements, disbursing loan proceeds and making certain that you keep up with loan requirements such as paying real estate taxes and hazard insurance premium. Lenders may charge a monthly servicing fee of no more than $30 if the loan has an annually adjusting interest rate or has a fixed interest rate. The lender may charge a monthly servicing fee of no more than $35 if the interest rate adjusts monthly. At loan closing, the lender sets aside the servicing fee and deducts the fee from your available funds. Each month the monthly servicing fee is added to your loan balance. Lenders may also choose to include the servicing fee in the mortgage interest rate.
Resources For Getting A Reverse Mortgage Locally in John Day ORReverse Mortgage Lenders in John DayReal Estate For Sale in John Day
John Day, Oregon
John Day is a city located about 2 miles (3.2 km) north of Canyon City in Grant County, Oregon, at the intersection of U.S. Routes 26 and 395. The city was named for the nearby John Day River, which had been named for a Virginian member of the 1811 Astor Expedition, John Day. The city was incorporated in 1901.
The first homestead staked in Grant County (what was then Wasco County), in 1862 by B. C. Trowbridge, was within the limits of the present city of John Day. The Eastern Oregon community was not as quick to grow as neighboring Canyon City, which was the county seat and center of the bustling mining industry in the area. Incrementally, local merchants and residents began relocating to John Day—primarily each time after severe fires in Canyon City: the Grant County Courthouse burned in 1870, Chinatown burned in 1885, and fires in 1898 and 1937 devastated Canyon City's downtown.
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