COMMON REVERSE MORTGAGE FEES
As we’ve covered in the past, reverse mortgages are an interesting option.
They come with their own set of considerations and requirements, and may be a great option if you meet them. Of course, every mortgage comes with its own set of associated costs, and these are no different. Below, we’ll break down some of the most typical reverse mortgage fees you’ll encounter.
As always, we want to aid our clients in their home based efforts. That’s why we’ve dedicated an entire blog, full of relevant literature to assist you along the way. Be sure to review the rest of our entries for more valuable information.
Origination and Appraisal Fees
From the beginning of the reverse mortgage process, costs begin to incur. As its name implies, lenders assess an origination fee for serving as the catalyst in this option. While there’s no guarantee, there is a chance the funding source will forego these charges.
Next, you have an appraisal fee. Think of this as a security deposit of sorts. It will cover the time spent evaluating your home, which may occur more than once. It’s tedious, but necessary when getting an accurate understanding of your home’s value.
MIP and Fees for Closing
An MIP, or an Upfront Mortgage Insurance Premium is unique in that it’s not present in every process. You’ll most likely run into this when applying for Home Equity Conversion Mortgage. It’s usually a minimal fraction of what the home’s appraised at.
You’ll also want to plan for any associated fees during closing. The list of these is extensive, and thus requires some intentional due diligence. From admin fees, to credit based considerations, and more. It’s a time consuming process, but the impending benefits are more than worth the effort.
Lender Fees and Interest
Another major consideration is loan servicing. It takes a great deal of attention and knowhow to handle a loan from the lender’s side. There may be costs associated with covering their time spent facilitating your loan. Ask your lender about auto-debiting. You can auto-debit these costs from any gains from your reverse mortgage. It helps to simplify the process.
Last but not least, as with most loans, you’ll have to contend with interest. While you won’t have to worry about any gains taxed with this option, interest is another story. You will be responsible for this upon the mortgage’s deadline.
Navigating Reverse Mortgage Fees with LeapFrog
Reverse Mortgages are a great tool for those who qualify for them. That said, you’ll want to know the ins and outs of this approach before committing to it. We hope that this information helps you to make an informed decision in the best interest of your home.
Know the route you’re looking to take? Let LeapFrog Mortgage help you along. Our staff operate with your home dreams in mind. For more questions about our services, contact us today. One of our experienced lenders will get you on the fast track to your dream home.
