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Proprietary Jumbo Reverse Mortgages
More Flexibility for Higher-Value Homes
If you own a higher-value home, a traditional HECM may not allow all of your home's value to be considered when determining how much equity you may be able to access.
A Proprietary Jumbo Reverse Mortgage provides another option, allowing eligible homeowners to potentially access more of their housing wealth while continuing to own and live in their home.
The right option depends on your home, your equity, your age, and what you want your housing wealth to help you accomplish in retirement.
What is a Proprietary Jumbo Reverse Mortgage?
A Proprietary Jumbo Reverse Mortgage is a privately offered reverse mortgage designed for homeowners who may benefit from accessing more equity than an FHA-insured HECM can provide.
Like a HECM, it allows eligible homeowners to convert a portion of their housing wealth into usable funds without requiring monthly principal and interest mortgage payments.
You continue to own your home and must meet the terms of the loan, including paying property taxes, maintaining required homeowners insurance, and maintaining the property.
Why Choose a Jumbo Reverse Mortgage?
For homeowners with higher-value properties, the amount available through a HECM may be limited because only a certain amount of the home's value can be used in the HECM calculation. A Proprietary Jumbo Reverse Mortgage may allow more of a higher-value home's equity to be considered.
1. Access More of Your Housing Wealth
If your home's value exceeds the amount that can be considered under the HECM program, a proprietary loan may provide access to additional equity.
How much is available depends on the specific program, your age, home value, existing mortgage balance, interest rates, and other eligibility requirements.
General Requirements:
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You must be 62 years old or older
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You must meet minimal credit and property requirements
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You must receive reverse mortgage counseling from a HUD approved counseling agency
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You must not be delinquent on any federal debt
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Home must be a primary residence
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Property must be a single-family home, a 2- to 4-unit dwelling, or FHA-approved condo
2. No FHA Mortgage Insurance Premium
Proprietary reverse mortgages are not FHA-insured HECMs and therefore do not require FHA's mortgage insurance premium.
Because these are privately offered loan programs, interest rates, costs, protections, and loan features can differ from a HECM.
3. Additional Program Flexibility
Depending on the program, proprietary reverse mortgages may offer different lending limits, property guidelines, age requirements, and ways to receive proceeds.
Program availability and requirements vary, which makes comparing your options especially important.
Is a Proprietary Jumbo Reverse Mortgage Worth Exploring?
A Proprietary Jumbo Reverse Mortgage may be worth considering if you have substantial equity in a higher-value home and want to understand whether more of that housing wealth could become part of your retirement strategy.
It may also be appropriate to compare a proprietary option with a HECM rather than assuming the loan that provides the most money is automatically the best choice.
The important question is not simply, "How much can I borrow?" It is, "Which option makes the most sense for the retirement I want?"
DID YOU KNOW? A jumbo reverse mortgage can also be used to finance the purchase of a new home.
A Proprietary Jumbo Reverse Mortgage may also be available when purchasing a new home. For homeowners considering a move in retirement, certain proprietary programs may provide another way to finance the purchase of a higher-value home while preserving other retirement assets.
Program availability and guidelines vary.
Is a Proprietary Jumbo Reverse Mortgage Right for You?
A Proprietary Jumbo Reverse Mortgage can provide greater flexibility for homeowners with higher-value homes, but it isn't the right solution for everyone. A Housing Wealth Review can help you look at your home, existing mortgage, available equity, and retirement goals to determine whether a proprietary jumbo reverse mortgage—or another strategy—is worth considering.