Texas Reverse Mortgages: A Comprehensive Guide
Understanding the ins and outs of reverse mortgages in the Lone Star State
If you are you a Texas homeowner aged 62 or older, looking for financial flexibility in your retirement years, a Texas reverse mortgage may be the solution you need. This comprehensive guide will help you understand the basics of reverse mortgages in Texas, their benefits, eligibility criteria, and the application process, so you can make an informed decision about whether this financial product is right for you.
What is a Texas Reverse Mortgage?
A Texas reverse mortgage is a financial product specifically designed for older homeowners. The most popular product offered in Texas is the Home Equity Conversion Mortgage (HECM), which has a requirement that homeowners be aged 62 and older and have significant equity in their homes. A HECM reverse mortgage allows you to convert a portion of your home’s equity into tax-free funds, providing you with additional income without having to sell your home or make monthly mortgage payments. The homeowner remains responsible for general upkeep of the home as well as payment of any property related charge, such as property taxes, homeowners insurance, HOA, etc.
There are also reverse mortgages called proprietary reverse mortgages, sometimes referred to as jumbo reverse mortgages. These products allow for homeowners aged 55 or older.
Benefits of a Texas Reverse Mortgage:
- Financial flexibility: A reverse mortgage can provide you with extra income to supplement your retirement savings, pay for medical expenses, or cover other living costs, giving you greater financial flexibility as you age in place.
- Tax-free funds: The money you receive from a reverse mortgage is tax-free, allowing you to maximize the benefits of your home’s equity.
- No monthly mortgage payments: With a reverse mortgage, you’re not required to make monthly mortgage payments. Instead, the loan balance is repaid when you sell the home, move out, or pass away.
- Non-recourse loan: A Texas reverse mortgage is a non-recourse loan, meaning you or your heirs will never owe more than the home’s value at the time of repayment, regardless of the loan balance.
- Retain homeownership: You continue to own and live in your home while enjoying the benefits of a reverse mortgage.
Eligibility Criteria:
To qualify for a Texas reverse mortgage, you must meet the following requirements:
- Age: You must be at least 62 years old.
- Homeownership: You must own your home or have significant equity in it.
- Primary residence: The home must be your primary residence.
- Financial assessment: Lenders will evaluate your financial situation, including your credit history and ability to pay property taxes, homeowners insurance, and home maintenance costs.
- HUD-approved counseling: Reverse Mortgage Loan Counseling: You must complete a counseling session with a HUD-approved counselor to ensure you fully understand the implications of a reverse mortgage.
The Application Process:
The Texas reverse mortgage application process involves several steps:
- Counseling: Attend a HUD-approved counseling session to learn about reverse mortgages and ensure you’re making an informed decision.
- Application: Complete a loan application with a licensed Texas reverse mortgage broker, such as ZYNG Mortgage (formerly MLS Mortgage).
- Appraisal: Your home will be appraised to determine its market value and calculate the amount of equity available to you.
- Underwriting: The lender will review your financial situation, credit history, and the property’s value to determine whether you qualify for a reverse mortgage.
- Closing: If approved, you’ll sign closing documents and receive the reverse mortgage funds as a lump sum, monthly payments, a line of credit, or a combination of these options.
Texas Reverse Mortgage Facts
| State | 2023 Closed Reverse Mortgages (through February) | 2022 Closed Reverse Mortgages |
|---|---|---|
| Texas | 374 | 4,053 |
| Nationwide | 4,427 | 63,442 |
| Data endorsement dates between January 01, 2023 and February 28, 2023 | Data endorsement dates between January 1, 2022 and December 31, 2022. |
Texas Lending Limit
The current Texas lending limit is $1,089,300.
Other Areas of Interest in Texas
Arlington, Austin, Dallas, Houston
Texas Reverse Mortgage Counseling
| Agency Name | Phone | Address | Website | Agency ID | Reverse Mortgage Counseling Type Offered |
|---|---|---|---|---|---|
| CREDIT COALITION | (713) 224-8100 | 3300 LYONS AVE HOUSTON, TX 77020-8252 | https://www.creditcoalition.org | 81768 | HECM |
| CREDIT COALITION HECM-HOPE | (713) 224-8100 | 3300 LYONS AVE # 203A HOUSTON, TX 77020-8252 | https://www.creditcoalition.org | 90347 | HECM |
| DALLAS COUNTY HOME LOAN COUNSELING CENTER | (214) 819-6060 | 2377 N STEMMONS FWY DALLAS, TX 75207-2710 | http://www.dallascounty.org | 81704 | HECM |
| HOUSING OPPORTUNITIES OF FORT WORTH | (817) 923-9192 | 1065 W MAGNOLIA AVE STE A FORT WORTH, TX 76104-4477 | http://housingoppsfw.com | 80471 | HECM |
| MONEY MANAGEMENT INTERNATIONAL - HOUSTON CALL CENTER | (866) 232-9080 | 12603 SOUTHWEST FREEWAY SUITE 450 MB #8 STAFFORD, TX 77477 | http://www.moneymanagement.org | 82423 | HECM, Platinum, HomeSafe |
| MONEY MANAGEMENT INTERNATIONAL INC. | (866) 232-9080 | 12603 SOUTHWEST FWY STE 450 MB#8 STAFFORD, TX 77477-3842 | http://www.moneymanagement.org | 82554 | HECM, Platinum, HomeSafe |
| NAVICORE SOLUTIONS- DALLAS, TX | (866) 472-4557 | SUITE 134 17440 NORTH DALLAS PARKWAY DALLAS, TX 75284-0001 | http://www.navicoresolutions.org | 84872 | HECM |
| SERVICES OF HOPE, INC. | (214) 276-0235 | SUITE 107 1137 CONVEYOR LN DALLAS, TX 75247-6821 | https://www.servicesofhope.org | 80185 | HECM |
| Texas Reverse Mortgage Counseling list is current as of 4/21/2023. Source: HUD Agency Search | |||||
Why Work With ZYNG Mortgage, a Texas Mortgage Broker?
- Product Optionality: As a mortgage broker, we have huge product offering. That means that we have access to a wide range of reverse mortgage lenders and their products. This broad access means that we don’t force into a specific loan because it’s all we offer. We also do forward mortgages, so if a “traditional mortgage” better suits your needs, we are able to offer it.
- Expertise and Knowledge: We are experts in the lending industry and have a deep understanding of various loan products, interest rates, and lending criteria. As such, we can provide valuable advice and guidance to help you find the best mortgage product for your needs.
- Extremely competitive rates and terms: We have lenders fighting for our business, which means increased competition, and allows us to pass that savings on to you.
- Potential cost savings: By helping you secure a competitive interest rate and loan terms, as a mortgage broker, we could save you thousands of dollars over the life of your loan. Additionally, a lower rate with a reverse mortgage equates to more proceeds available to you.
- Ongoing Support: We are with you from day 1 when you’re just learning about the product and will be with you throughout the loan process and long after closing. We are here to support you in helping you better age in place.
MLS Reverse Mortgage, powered by ZYNG Mortgage vs. others
Other lenders may pay big bucks for Tom Selleck, but that doesn’t give them better customer service or pricing advantages. Our smaller size allows us to be nimble and flexible and we can hang our hat on our A+ Better Business Rating and 5 Star Google Reviews.
We have an Exemplary A+ rating on the Better Business Bureau with several reviews from satisfied clients.
Conclusion:
A Texas reverse mortgage can be an excellent financial tool for eligible homeowners seeking additional income and financial flexibility during their retirement years. Understanding the benefits, eligibility requirements, and application process is crucial to making an informed decision. If you’re considering a reverse mortgage, consult with a licensed Texas reverse mortgage specialist to discuss your options and determine if this financial product aligns with your needs and goals.