Reverse Mortgage
Many older homeowners have accumulated a large amount of equity in their homes, but may still have a need for additional income during their retirement years. The credit union offers a reverse mortgage loan that can help you tap the equity in your home and supplement your monthly income.
A reverse mortgage is a loan against your residence in which the credit union provides cash to the borrower in the form of a fixed monthly disbursement and/or a single lump-sum disbursement. Borrowers can use the disbursements for a variety of purposes such as living expenses, health care expenses or home repairs. All borrowers must be at least 62 years old and utilize the home as their primary residence. Property taxes, homeowner’s insurance and home maintenance remain the responsibility of the homeowner.
A reverse mortgage does not have to be repaid as long as the borrower(s) continue to live in the home. When the last borrower dies, sells the home or permanently moves out of the residence, the loan must be repaid, including all interest and other charges.
Reverse Mortgage Specifications:- All borrowers must be at least 62 years old
- Fixed interest rate of 6.75%
- No monthly payments
- Simple interest accrual versus compounding interest
- Origination fee of 1% of the property value
- No mortgage insurance fees or monthly servicing fees
- Property must be your primary residence and located in North Carolina
- Property must be located in a residential subdivision or within the corporate limits of a municipality
- Manufactured homes, condos, townhomes and rural properties are not eligible
- Maximum loan amount is based on the value of your home, the life expectancy of the youngest borrower and the interest rate on the loan
Before a reverse mortgage loan can be closed, all borrowers must receive face-to-face reverse mortgage counseling with a counselor approved by the North Carolina Housing Finance Agency. The counseling session is designed to educate the borrower on the pros and cons of reverse mortgages, the availability of other mortgage options, the impact of reverse mortgages on the borrower’s estate, and eligibility for assistance under federal and state programs. A list of approved counselors can be found at the North Carolina Housing Finance Agency Web site. After participating in counseling, you will receive a certificate from the counselor validating that counseling has been completed.
Pick up a copy of the Reverse Mortgage booklet at your local branch to learn more about reverse mortgages. Once you are certain that a reverse mortgage will meet your needs, you can apply for a credit union reverse mortgage.
Decide if a Reverse Mortgage is right for you.- Contact the Call Center at 888.732.8562
- Visit your local branch
