To qualify for a reverse mortgage, you must meet the following requirements.

• Be a senior homeowner (at least 62 years old);
• Use the home as a primary residence;
• Maintain insurance and property tax payments;
• Meet FHA minimum property standards;
• Own the home outright or have a low mortgage balance;
• No delinquent federal debt, like income taxes or federal student loans.

There are no other income, credit, or additional requirements to qualify for a reverse mortgage in Ohio.

A reverse mortgage in Ohio will have many of the same costs as a traditional loan, including:

• HECM Counseling Fee: A variable fee is associated with the mandatory HUD counseling session.
• Origination Fees: The cost to originate or create the loan. Reverse mortgage origination fees cannot exceed $6,000.
• Closing Costs: The closing costs can vary and may include taxes, appraisal, title search, surveys, and more.
• Mortgage Insurance Premium: The FHA requires all reverse mortgages to pay an initial amount up front as part of the closing. You also pay an annual fee, which can be rolled into the life of your loan.
• Interest: You pay interest on the reverse mortgage. Based on the type of loan you received, it can be fixed or variable.

District Lending can help you understand the total costs of a reverse mortgage in Ohio.

After your death, your heirs must settle the value of the reverse mortgage. They will have 30 days to buy or sell the home. Your heirs can consult with a HUD counselor or an attorney to extend the deadline up to six months.

According to the Consumer Financial Protection Bureau, your heirs must repay the loan’s total balance or 95 percent of the home’s appraised value, whichever is less. The loan can be repaid from the home’s equity, and any remaining equity will be turned over to your heirs.

If there is not enough equity in the home to cover the reverse mortgage, your heirs can sell the home to cover the cost. Your heirs will get the difference if it sells for more than the reverse mortgage.

You will need to repay the reverse mortgage in full if you sell your home, it’s no longer your primary residence, or you no longer meet the requirements of the loan. This could include if you don’t pay your property taxes, do not meet minimum FHA standards, or drop homeowners insurance. Failure to do so could cause the loss of your home.

If you do not meet the requirements of your reverse mortgage, your home could get foreclosed. Family members who live with you could lose their home following your death if they are unable to settle the loan.

District Lending can help mitigate these risks, discussing options for Ohio homeowners to ensure this type of mortgage is right for you and educating them on the potential risks so you can prepare.