Question:

Are HECM loans the only loans for seniors?

Answer:

HECM loans can hardly be the only type of loans seniors should consider. If you are considering a reverse mortgage and a home equity loan, a reverse mortgage may be the better option, especially if you are deep into your retirement years as you will not have to pay the bank; rather, they will be paying you.

If you don't want to exhaust your equity with a HECM loan or another type of reverse mortgage, but you need an emergency source of quick funds a home equity line of credit may be a good option.

If you have set your mind on a reverse mortgage, you should consider HECM loans as only one of many existing options. Even though HECMs account for 90% of originated reverse mortgages, there are other reverse mortgage loans available. For example, Fannie Mae's Home Keeper is a popular alternative to a HECM loan - it has slightly higher loan limits. Also, if you have a real luxurious home with value much over FHA or Fannie Mae loan limits, you should be considering a proprietary jumbo reverse mortgage instead of a HECM loan or a Fannie Mae Home Keeper. Respectively, if you live in Canada, you may consider the CHIP reverse mortgage.

In all cases, you should attend reverse mortgage (or HECM) counseling to be presented with relevant options to your particular situation.

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