This question “are there closing costs with a Reverse Mortgage“, pops up frequently. And the answer is yes, there are closing costs on a reverse mortgage just like there are closing costs on a traditional mortgage or on a line of credit. The reason for this is the lender requires the borrower to have independent legal advice also known as ILA for their benefit and protection.
What Are Closing Costs On A Reverse Mortgage?
What Are The Typical Closing Costs For A Reverse Mortgage
This cost can vary depending on your location and the lawyer you choose, and the fee is approximately $500-$1000. This fee is paid directly to your lawyer. If there are any debts to be paid out with the new Reverse Mortgage this lawyer will pay out these debts.
Average Closing Costs For A Reverse Mortgage
You will need to have an appraisal done on the property as the fair market value is a factor in determining how much you will receive in your Reverse Mortgage. The appraisal is one of the first things needed to start the process. The lender will order the appraisal from an independent firm.
Just like traditional mortgage, reverse mortgage has closing costs including lawyer fees, an appraisal done on the property as well as administrative costs at the very least.
Administrative costs for the Reverse Mortgage can run you approximately $1800 to $2000. The lender does most of the gathering and preparing of the Mortgage documents. The costs are similar to closing a regular mortgage.
With the continued rise in the senior population, a Reverse Mortgage is a great financial option providing freedom, stress free living and supplementing your pension income.
With our increased life expectancy Canadians have not prepared for retirement and don’t want to change their standard of living.
With the increase in property values and forecasting to continue to rise, accessing the equity of the property is now a smart financial option for seniors. Remember, the lenders for Reverse Mortgages do not want your home. They want to help you continue to enjoy your life.
Title remains in your name, and they will never foreclose on your home. You must be a minimum 55 yrs of age and own your own property. You may take out equity as a lump sum of tax-free cash payment or you can pay yourself monthly, and it does not influence your pension income and you get to choose how you want to spend your money.
Isn’t it about time your home started paying you back?
With a reverse mortgage who retains the title to the home?
A reverse mortgage allows the homeowner to keep their house as long as they pay their property taxes, maintain it, and keep it insured. You will be responsible for the valuation fees, legal fees, and other costs associated with the sale of the land. The borrower retains ownership of the land, including any unused equity, and is never required to leave.
Do I Need A Broker To Buy A House?
When using the term “broker” what are we referring to ? The term can be used to refer to a realtor (real estate broker), or a mortgage broker. In either case, the answer is NO, you do not need a broker to buy a house. Just like you do not need a lawyer to go to court and fight your case. Nor do you need a travel agent to book your trip. You can also say the same thing about a mechanic, to change your brakes.
What Is Reverse Mortgage?
A Reverse Mortgage is a loan product secured by a principle residence enabling the homeowner to access the equity of the home and not make traditional mortgage payments on the loan. According to a recent study, 93% of Canadians want to remain in their home as they age. Access to traditional lending becomes limited for seniors as the income isn’t always there to support the lender guidelines.
How Much Is A Mortgage Advisor?
When using the services of a mortgage advisor, when it comes to how they get paid. There are out of pocket costs for the set up and closing of your mortgage and property, however, which you should be aware of well in advance of your closing. But as far as how much a mortgage advisor costs, well we have to back track a little bit and get an understanding of the way that the mortgage industry works.
Who is not eligible for a reverse mortgage?
You are not eligible for a reverse mortgage if you do not meet the minimum age requirement of 55 years of age, and if you do not own your principle residence with a fair amount of equity in it you will not be eligible for reverse mortgage. It doesn’t mean you won’t ever be eligible just means at this current time you are not eligible.
What Do I Need To See A Mortgage Advisor?
This varies depending on the individual policies and procedures. For us, the best place to start is with a 20 minute phone call. You do not need anything. If we get to it, the most skill testing question we will be asking you is what is your SIN. The rest of the information you should have available at the tip of your tongue. During this initial call we are often able to address 99% of your questions or concerns.
Can you get a reverse mortgage on a condo in Canada?
Another factor is the location of the property the type of dwelling on the property and the overall marketability of the property. So let’s start with the location of the property. The location of the property must be in an urban centre, it cannot be a rural property or an agricultural zoned property. It must be the applicants’ owner occupied principle residence and this can either be a single family home, an apartment style condo, a high rise condo or a town home.
Is It Better To Get A Mortgage From A Bank Or Mortgage Company?
This is a great question – is it better to get a mortgage from a bank or mortgage company. There are benefits and short comings with any mortgage product, be it from a mortgage company, or from a bank. The key is, understanding your situation. Being crystal clear on your goals, not only for the short term, but medium term and also the long term. Once you are crystal clear on your goals, you also want understand your demographics.
Can a family member be added to a reverse mortgage?
Other family members such as your children even though they may be adults they are not eligible to apply for a reverse mortgage or be on title of your reverse mortgage if they do not meet the minimum age requirement of 55. If you happen to pass away and your property has a Reverse Mortgage on it and you have left your property to other family members, they will not be able to assume the Reverse Mortgage as they will not meet the required criteria at this time.
What Makes A Good Mortgage Broker?
There are a lot of qualities that can be mentioned here, to determine what makes a good mortgage broker. Like most of these questions, context is important. Above all, the sign of a good mortgage broker, is the mortgage broker who listens to you and tries to understand your goals, and your needs. A good broker, also takes the time to explain his or her role, and set expectations. A good broker will be direct with you, never beat around the bush.
For a FREE consultation with no commitment please contact me. Let’s get started today to get back the life you want to live. And as a Certified Reverse Mortgage Specialist I would be more than happy to review your financing options with you and provide you with Expert Advice to Guide You Home.
