Got a question about a Senior Equity Line of Credit - Reverse Mortgage? We probably have the answer!


What is a Senior Equity Line of Credit - Reverse Mortgage?

A Senior Equity Line of Credit - Reverse Mortgage is a loan against your home that you do not have to pay back, as long as you live there. With this type of loan, you can turn the value of your home equity into cash without having to move or repay a loan each month.  Yet it is flexible in that, like a credit card, you can pay the loan back in whole or in part. Anytime that you wish.


I still have a mortgage on my house. Can I still obtain a Senior Equity Line of Credit?

YES! As long as there is sufficient equity in the property, the homeowner may be eligible for a reverse mortgage line of credit. In fact, many seniors use the line of credit to pay off their existing mortgage and thus eliminate a required monthly mortgage payment.


Do I have to pay income taxes on the money I use?

NO! The cash from your line of credit is TAX FREE! In essence you are lending to yourself. Use the funds without restrictions.  Some have used it as a lifeline, while others have used the line of credit to supplement their income.  Many financial advisors and planners recognize the benefits of this financial tool.


Will a Senior Equity Line of Credit - Reverse Mortgage impact my Social Security and Medicare benefits?

A Senior Equity Line of Credit - Reverse Mortgage will generally not affect regular Social Security payments or Medicare benefits. Depending upon the homeowner's situation, this reverse mortgage may affect benefits one receives, if any, from the Federal Supplemental Security Income (SSI) program, or a state-administered program like Medicaid or Medi-Cal in California. It is recommended that the borrower speak with his or her financial advisor and appropriate governmental agencies.

Could I end up owing more that the home is worth?

The fact is that the borrower or his estate can never owe more than the value of the home upon repayment, regardless of what happens in the future. The Senior Equity Line of Credit or HECEM is insured by the Federal Housing Administration (FHA), an arm of the U.S. Department of Housing and Urban Development (HUD). There are a number of added protection features in place for your financial safety.