A HECM makes it possible for you to stop making monthly mortgage payments and stay in your home. In addition, there are a number of HECM payment options for receiving cash from your home equity. If you want to convert some of your home equity into cash, you have options for disbursement of payments. You may elect to receive cash in one lump sum payment, or monthly payments.
A HECM allows you to withdraw cash from your home equity without having to make any monthly payments. You can elect to withdraw a lump sum payment, up to the limit set by the FHA. A lump sum withdrawal does not have any restrictions on how you can spend the money, and you will not have to pay income taxes under the current guidelines for HECM loans. You can also select to receive cash in the form of a monthly payout. If you select for a monthly disbursement, you will receive a fixed amount each month either for as long as you remain in the home, or for a fixed number of years. The amount of cash available depends on the equity in your home and the limits set by the FHA for loan amounts. In general, the more equity you have, the more that you can withdraw.
Choosing the best option for HECM payments depends on your needs and goals. Limits have been set by the Federal Housing Administration (FHA) for maximum HECM loan amounts. A HECM can give the cash you need without having to pay HELOC or REFI payments. Call our team today to discuss your needs, before you commit to any reverse mortgage companies. We will take the time to understand what you want and need. We will make sure that you select the option that makes the most sense for you, based on your goals.
Lump Sum Options
A HECM makes it possible to quickly and easily access the equity in your home without having to make loan payments each month. If you need the maximum amount of cash in hand, electing a one time payment probably makes the most sense. A HECM provides a lump sum option to convert your equity into cash up to limits set by the FHA. Using the lump sum option, your cash is disbursed in one payment to you, without restrictions on use. As a rule, under current FHA guidelines, you will not be able to withdraw all of the equity out of your home, only a portion. To find out how much cash you can access, you should call one of our team members to discuss your options today.
A HECM Loan provides total flexibility when it comes to spending your cash proceeds. You can spend a lump sum amount any way you choose to, without any income tax restrictions. You may want to make long term investments, purchase additional real estate, cars, vacations. You may want to pay off debt, or credit cards with high interest rates. You may want to pay off medical bills, or cover costs of expensive operations that are not covered by your insurance. If you have the need for a lump sum amount, a HECM may be a great option for you.
Payment Plan Options
You may want to consider a HECM if your Monthly expenses have gone up and you are having a hard time keeping up. It might be a good idea for you to choose a payment plan that gives you extra income every month to cover the increasing costs of groceries and utility bills, not to mention the many unforeseen expenses that arise. Things like home and auto repairs pop up and create real stress for many who are barely able to afford the fixed expenses.
With a HECM, you can choose a payout each month from the proceeds of the loan. That payout can be for a fixed amount of time, or for the duration of the time you live in your home, depending on what makes sense for you. HECM payment amounts are calculated based on your needs and desires, so that you can comfortably afford the day to day expenses and have some breathing room. If you decide to change your payment plan at a later date, that is possible as well. A HECM payment plan can be structured for you based on your goals and your future plans. The best way to decide what makes sense is to discuss your situation with one of our professional team members today. Pick up the phone and ask questions, we are here to help you decide whether a HECM is right for you or not.
Learn More about Reverse Mortgage Lenders
Before you commit to any reverse mortgage lenders, our team will meet with you either on the phone or in person. We will make sure that we know what your goals are, and what you need. Our goal is to help you select a HECM preferred payment option that works for you.
Whether you want cash out, or simply want to stop making mortgage payments, we will use a HECM calculator to see if the numbers make sense. We will offer the best HECM options for you, and we will tell you when a HECM doesn’t make sense for you. We care about our clients, and we rely on our reputation as a trusted broker. We know that if we cannot help you to meet your goals, you will not recommend us to your friends and family. At the end of the day, our reputation and referrals means more than closing a deal that doesn’t meet your goals.