The reverse mortgage loan process is generally the same regardless of which lender you choose. However, the following are some reverse mortgage tips that can help you prepare and may even streamline the process. Two of the steps that involve homeowner engagement are: 1) the Housing and Urban Development (HUD) counseling session1 and 2) the appraisal of the property. Preparation for these tasks can be tricky so we’ve compiled a list of reverse mortgage tips for those going through the process.
The purpose of the required counseling session is to:
Tips to Prepare for Counseling
Prior to the counseling session each document should be reviewed, and any questions should be addressed with the loan advisor.
An appraisal is required by the Federal Housing Administration (FHA) to determine the home’s value and to make sure the home is safe, structurally sound and does not represent a risk to homeowner health and/or safety of the property. Minor cosmetic issues are typically not a concern.
Tips to Prepare for an Appraisal
Consider these tips in advance to minimize the risk of the appraiser needing to return to complete the inspection:
What happens after the appraiser leaves?
The appraiser will look at comparable homes in your local area as part of the process for determining the home value and generally needs a few days to complete the report.
As of October 2018, the FHA performs a Risk Assessment on each appraisal to determine if the appraisal is acceptable or if a second appraisal is required. It generally takes 24 hours for the FHA to make that determination. If a second appraisal is required, a new appraiser will call to schedule an appointment.
It is important to be prepared for all aspects of the reverse mortgage process to ensure the timely processing of the loan. Whether you’re at the beginning of your research into reverse mortgages or ready to apply, a licensed loan advisor can help guide you through the process. Call 1 (800) 976-6211 to speak with a loan advisor today!
1 The U.S. Department of Housing and Urban Development (HUD) provides a list of approved reverse mortgage counseling agencies for you to choose from. The purpose of this requirement is so you are aware of all of your options, and can evenly weigh the pros and cons of each.