July 30, 2015

HECMs require financial assessment

By Marcie Geffner - HSH.com

Until recently, homeowners who were at least 62 years old could tap the equity in their home through a reverse mortgage with little, if any, consideration of their personal financial situation.

But no more.

New federal-government guidelines now require an assessment of each prospective borrower's income, assets and debts, explains Eric Meehan, owner of Golden Opportunity Mortgage in San Diego.

"No longer is it just age, equity and the value of the home and based on life expectancy," Meehan says. "On top of that, they take a look at your monthly income and assets versus your revolving debt. They want to know your monthly payments, taxes, insurance, credit cards - any other monthly debt that you pay."

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