Reverse Mortgage FAQ's

Don't forget to check our frequently asked question lists for:

How does a Reverse Mortgage work?
Where does ALLIED do Reverse Mortgages?
Who is eligible for a Reverse Mortgage?
How safe is a Reverse Mortgage?
How much money will I receive?
Are there fees or charges involved in obtaining a Reverse Mortgage?
Will I have to make mortgage payments during the life of my loan?
How can I use the money I receive from my Reverse Mortgage?
Will I still have an estate to leave my heirs?
How do I apply for a Reverse Mortgage?

How does a Reverse Mortgage work?

A Reverse Mortgage converts the equity in your home into spendable dollars, paid to you in regular monthly installments or according to whatever plan of payment you choose.

When you sell your home or move out, you or your estate will repay that cash, plus interest and other finance charges, to the lender. All proceeds above and beyond the amount you owe belong to you or your estate.

Where does ALLIED do Reverse Mortgages?

ALLIED is currently originating Reverse Mortgages in Iowa and Nebraska only.

Who is eligible for a Reverse Mortgage?

Eligible borrowers must be at least 62 years of age and either own their home or have a very low outstanding mortgage balance which could be paid off from the proceeds of the new Reverse Mortgage. Your home must be your principal place of residence.

Before you apply, you will receive a free informational session with a U.S. Department of Housing and Urban Development (HUD) approved housing agency representative. Family members are also encouraged to attend these sessions. This will help you in deciding if a Reverse Mortgage is right for you.

How safe is a Reverse Mortgage?

Once you have attended the informational session and gone through the application process, you'll see for yourself that a Reverse Mortgage is a safe, sensible mortgage option.

With a Reverse Mortgage, you retain title to your property. As long as you own and occupy your home, you are not obligated to repay the mortgage loan.

Under these programs, no debt will be passed along to your heirs. If the loan amount exceeds the value of your home, you cannot be forced to sell or vacate your home as long as you continue to occupy the property as your principal place of residence.

How much money will I receive?

The amount of money you receive will depend on several factors, including your age, the appraised value of your home, the current interest rate, and the program mortgage loan limits in your area.

With the Reverse Mortgage, you may choose from several payment options, including regular monthly payments or an initial lump sum. You can also designate all or part of the available funds to be set aside in a line of credit available to you at any time, for any reason.

Payment options can be combined as you see fit. ALLIED will customize the plan to fit your wishes. You can make adjustments in your plan at any time.

Are there fees or charges involved in obtaining a Reverse Mortgage?

Like other mortgage loans there will be an origination fee, closing costs, and a mortgage insurance premium. Since most of these fees may be financed, you may not have to pay for them up front. An appraisal and credit report fee will also be collected when you apply, but these charges may be financed in your loan. A servicing fee will be set aside up front and charged monthly over the life of the loan.

Will I have to make mortgage loan payments during the life of my loan?

You will not have to make mortgage loan payments as long as you continue to live in your home. You will, however, still be responsible for real estate taxes and homeowners insurance, as well as any other non-mortgage payment items (e.g., condominium fees, homeowners' association fees, etc.). When you no longer occupy your home, the total outstanding balance on your loan will be due. Reverse Mortgages are repaid from the proceeds of the sale of your home.

How can I use the money I receive from my Reverse Mortgage?

The money is yours to spend any way you wish; home improvements, unexpected medical expenses, a vacation, or even a new car. Whether you need immediate cash for special purposes or regular monthly payments to help supplement your present income, a Reverse Mortgage can provide you with those funds.

Will I still have an estate to leave my heirs?

That will depend on the amount of your loan and how long you choose to live in your home, but in many cases the answer is "yes."

When your home is sold, the proceeds remaining after the loan is repaid belongs to your estate. Your heirs may also decide to pay off the loan themselves so they may keep the home. More importantly, should the value of your home be less than the outstanding mortgage loan balance, the additional debt cannot be passed along to your heirs.

How do I apply for a Reverse Mortgage?

The best way to get started is to call your ALLIED Loan Counselor. You will be provided with the name of an approved housing agency near you for your FREE pre-application information session.

If a Reverse Mortgage is the right choice for you, it can make a big difference in your life. Call ALLIED today.

We look forward to serving you!