How to Choose a Reverse Mortgage Lender
If you have decided that a reverse mortgage is the best option for your living needs and estate planning situation, you are on the path to creating a solid financial plan. But getting through the reverse mortgage process can seem a bit tricky. To start off, you will need to select a reverse mortgage lender.
So Many Reverse Mortgage Lenders — How Do I Choose?
Just like taking out a regular mortgage, you may have realized that there are quite a number of reverse mortgage lenders. So many that it can be overwhelming to compare and choose. Where do you start?
Reach out to family and friends. Reverse mortgages have been around for decades. With that long of a history, chances are you know someone who has a reverse mortgage or has experience with a family member (such as a parent or grandparent) who has a reverse mortgage. Family and friends can provide you with real-time feedback about their experiences, process and lenders, giving you some reverse mortgage lender referrals.
Consider all lenders in your community. It’s not uncommon to find small, local lenders (as well as national lenders) seated within your own community. Don’t rule out smaller lenders — these providers can offer face-to-face meetings with ease, allowing you to benefit from strong customer service.
Ask for quotes. While a lender may examine your credit to determine if you have reliably paid your mortgage, property taxes and homeowner’s insurance, your actual credit score will not required for a quote. Lenders are more focused on how responsible you are in factors related to your home. For this reason, you do not have to worry about your credit score being impacted by asking for quotes. Feel free to get several quotes from prospective reverse mortgage lenders to weigh your options.
What to Look For in a Reverse Mortgage Lender
More banks and financial institutions have entered the business of being reverse mortgage lenders. This is great because you will not be stuck with only a few options, but instead many providers. Another factor in selecting the best reverse mortgage is choosing a lender that fits your needs. When it comes to selecting a reverse mortgage lender, you will want to consider:
Credibility. Just like any major financial choice, you want to ensure that the reverse mortgage lender you choose is a credible, reliable institution. It is worth contacting the Better Business Bureau, reading reviews online and researching the company to learn more about the reverse mortgage lender prior to signing any paperwork.
Pressure-free. If you feel that a reverse mortgage lender is pressuring you, consider stepping back for a moment. There is no reason to rush into a reverse mortgage, and you should feel that your lender is willing to walk you through all of your options without the pressure to do business with them.
Resources and communication. Entering a reverse mortgage is a large decision. Your reverse mortgage lender should help you through the process by providing resources and information about all decisions available to you — and it is a red flag if they do not. The U.S. Department of Housing and Urban Development (HUD) requires a counseling session for anyone entering into a reverse mortgage. If your company skips this session, know that there could be other information they are not telling you.
The reverse mortgage process does not have to be scary or overwhelming. Are you considering a reverse mortgage? If so, consider speaking with