Find the Best Reverse Mortgages in Buffalo, NY

What are the different types of reverse mortgages in Buffalo?

There are three types of reverse mortgages. The right type of reverse mortgage for you depends mainly on how you want to spend the money, the value of your home, how much you want to borrow and how you want to receive the funds.

Home Equity Conversion Mortgages

Home Equity Conversion Mortgages (HECMs) are the most common type of reverse mortgage. They are federally insured. Interest rates can be fixed or adjustable. You can choose to receive payment in a lump sum, monthly, through a line of credit or in a combination of ways. You can use the cash from a HECM for anything, like investing or remodeling a bathroom.

To obtain a HECM in Buffalo, you must first meet with an approved counselor to go over requirements, financial implications and alternatives.

Proprietary reverse mortgages

Proprietary reverse mortgages are privately backed, so they don’t have the same restrictions as HECMs. Jumbo reverse mortgages are proprietary reverse mortgages that allow owners of higher-value homes with small mortgages to borrow more than the federal maximum for a HECM. Companies offer proprietary reverse mortgages that, unlike HECMs, have no mortgage insurance premiums and no limits on proceeds in the first 12 months.

Single-purpose reverse mortgages

In a single-purpose reverse mortgage, the lender chooses how the borrower can use the money. For example, the lender might specify that funds can only be used for paying property taxes or making home repairs.

Single-purpose reverse mortgages are offered by state and local government agencies and nonprofits, and they aren’t available everywhere.

Reverse mortgage requirements and process in Buffalo

Reverse mortgage requirements in Buffalo can slightly differ based on the type of reverse mortgage and the lender. For a HECM, the most common type of reverse mortgage, the requirements are as follows:

• Age: You must be at least 62.
• Homeownership: You must own the property outright or have paid down a considerable amount of your mortgage. The property must be your principal residence and meet all Federal Housing Administration standards and flood requirements.
• Finances: You can’t be delinquent on federal debt, and you must be financially able to pay property taxes and homeowners insurance costs.
• Counseling: To get a HECM, you must participate in a consumer information session with a government-approved counselor.

Be prepared when applying for a reverse mortgage in Buffalo to hand over proof of income and assets and a list of your monthly living expenses. The lender will also check your credit history.

Before taking out a reverse mortgage, you should compare loan options, interest rates and fees from different lenders. Questions you might want to ask a counselor or company representative include:

• What are the upfront fees and costs and the ongoing costs of a reverse mortgage?
• What responsibilities do I have once I take out a reverse mortgage?
• How will I receive the money? Will it be in a lump sum, monthly payments or a line of credit? Can I choose?
• How does a reverse mortgage affect my existing mortgage?
• How does a reverse mortgage affect my spouse or others living with me?
• What happens if I choose to move or have to move, or if I die?
• Are there other options I should consider?

Avoid any reverse mortgage company that pressures you or tries to rush you through the process. Be aware that there are reverse mortgage scams. And know that with most reverse mortgages, you have a “right of rescission,” giving you three business days after closing to cancel for any reason without penalty.

Buffalo reverse mortgage FAQ

What is a reverse mortgage?

A reverse mortgage converts part of your home equity into payments from a lender. You don’t need to pay back the loan for as long as you live at the home. The most common type of reverse mortgage, a HECM, gives you options for receiving the funds and allows you to spend them however you want. Reverse mortgages have fees and interest like other types of loans, and you are still responsible for paying property taxes and homeowners insurance premiums. When you move out of the home or die, you, your spouse or your estate is responsible for repaying the loan.

What are the advantages of a reverse mortgage in Buffalo?

A reverse mortgage can give you extra financial flexibility by providing an “advance” on your home equity. A HECM, the most common type of reverse mortgage, gives you different payment options and the ability to spend the money however you wish. A reverse mortgage lets you stay in your house. The funds are usually tax-free and don’t affect your Social Security or Medicare benefits.

How much can you get on a reverse mortgage in Buffalo?

The amount you can borrow with a reverse mortgage in Buffalo depends on how old you are, the type of reverse mortgage, your home’s appraised value, current interest rates and your financial situation. Government-backed HECMs have a borrowing limit of $765,600 at the time of publishing. Jumbo reverse mortgages have higher borrowing limits.