Reverse Mortgage

Many older homeowners may find themselves in need of additional income in their retirement years. Put the equity in your home to work for you and consider an LGFCU Reverse Mortgage.

A reverse mortgage is a loan against your residence in which the Credit Union provides cash as a lump sum, a line of credit, or a fixed monthly disbursement.

Members can use the disbursements for whatever is needed, from covering daily living or health care expenses to making repairs or accessibility improvements to the home. Lump sum only distributions are limited to the payoff of existing mortgages and other debt, medical care expenses, and home improvements.

To qualify, borrowers must:

  • Be at least 62 years old
  • Use the home as their primary home
  • Have a relatively small amount of debt against the property (in general, no more than half the property's value)

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 features

  • Fixed interest rate—please call for a quote
  • No monthly payments
  • Simple interest accrual versus compounding interest
  • No mortgage insurance fees or monthly servicing fees

Before a reverse mortgage loan can be closed, all borrowers must receive face-to-face counseling with a North Carolina Housing Finance Agency-approved financial counselor. The 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 website.

Additional information

  • Property must be your primary residence and located in North Carolina
  • Manufactured homes, condominiums, townhomes or rural properties are not eligible
  • Property must be located in a residential subdivision or within the corporate limits of a municipality
  • 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
  • Certain property restrictions may apply—call the Contact Center at 888.732.8562 for more information

Next Steps

Ready to start the reverse mortgage process?