Page 1 - AAG225_EZ-Access Myths and Realtities Flyer

Myths & Realities of HECM Loans

As with many financial products, Home Equity Conversion Mortgage (HECM)

loans can be complicated, and there are a number of misconceptions about how
the product works. Do you know the myths vs. the realities?

Myth Myth Myth
#1 #2 #3

The lender owns the home. The borrower is restricted on how to Once loan proceeds are received,
use the loan proceeds. you pay taxes on them.

Fact Like all mortgage loans, the HECM Fact The proceeds from a HECM Fact Like any loan, HECM proceeds
loan is secured by a lien and you will not loan can be used for almost any are paid out tax free as they are not
lose your home as long as you continue purpose. Many borrowers use them to considered income. However, it is
to meet the loan obligations. You supplement their retirement income, recommended that you consult your
cannot lose your home under normal delay receiving Social Security benefits, financial advisor in connection with your
circumstances and so long as you pay pay off higher-interest credit cards, pay reverse mortgage loan application.
your taxes and insurance and otherwise for medical expenses, remodel their
comply with the loan terms. home, or help their adult children.
Prudence along with budgeting should
be the proper approach to enjoying
proceeds received from your HECM loan.

Myth Myth
#4 #5

The home must be free and clear of Only people with financial hardships
any existing mortgages. need HECM loans.

Fact Actually, many borrowers use Fact The perception that HECM loans
the HECM loan to pay off an existing are only for “financially strapped” Call today to
mortgage and eliminate monthly borrowers is changing — affluent senior

mortgage payments. Paying off the borrowers with multimillion-dollar learn more!
existing mortgage and any other liens homes and healthy retirement assets are
is required as part of the loan. It is the using HECMs as part of their financial First Name Last Name
borrower’s responsibility to continue and estate planning, and are working NMLS#
to pay for property taxes, homeowners closely in conjunction with financial Title
insurance, and home maintenance. professionals and estate attorneys Phone
to enhance their overall quality and Email
enjoyment of life. URL