|
|
HECM
|
HELOC
|
| Age
Requirement |
62+ |
18+ |
| Mortgage
Type |
Reverse
Mortgage based on equity. Can take out a percentage of home
value, but no payments are made on loan until property is permanently
vacated by borrower(s) |
Loan
based on home equity. Can take out a percentage of home value,
but must make monthly payments to reduce loan balance. |
| Government
Insured |
Yes |
No |
| Qualifying
Requirements |
Amount
received based on age and home value |
Loan-to-value,
Debt-to-income ratio |
| Proceed
Options |
Monthly
income, line of credit, or lump sum (or a combo of all three) |
Line
of credit and/or lump sum |
| Monthly
Payment Made to Lender |
None |
Minimum
of interest only payments to be made |
| Interest
Rate |
Variable,
tied to the T-bill |
Variable,
tied to Prime |
| Average
Turn Time for Closing |
30
days approximately |
2
weeks approximately |
| Closing
Costs |
Varies
depending on lending limit or appraised value |
Varies
depending on loan amount and lender |
| Tax
Write Off |
When
loan is paid in full |
Annually
based on interest paid |
| Spending
Restrictions |
None |
None |
