In order to be eligible for the FHA Reverse Mortgage for Home Purchase Program, a client must be at least 62 years old. If there is more than one person on title, the calculations are based on the age of the youngest. The earliest that a potential client can apply for the program is, from a practical standpoint, 61 years and 10 months allowing for a 60 day closing. I have closed more than one Revers Mortgage loan on a client's 62nd birthday!
Here is the actuarial life expectancy table that the Government uses that is built into the HECM formula:
Client's age Expected Maturity Approximate Down Payment % ($250,000 selling price)
62 21 years 47% or $117,500
63 20 years
64 19 years
65 & 66 18 years 44% or $110,000
67 17 years
68 & 69 16 years
70 15 years 40% or $100,000
71 14 years
72 & 73 13 years
74 & 75 12 years 37% or $92,500
76 11 years
77 & 78 10 years
79 & 80 9 years 33% or $82,500
81 & 82 8 years
83 & 84 7 years
85, 86 & 87 6 years
88, 89 & 90 5 years 29% or $72,500
With all other things being equal, the older a person is, the more funds that he or she is eligible for and therefore less money needed for a down payment. In order for you to determine the approximate down payment requirements for different valued properties and ages, click on our Down Payment Approximator @ http://www.tinyurl.com/32rxg28.
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