It is important to meet with an experienced reverse mortgage professional. I highly recommend working with someone that specializes in reverse mortgages as they can better educate you about the product, answer questions and understand the intricacies of the reverse mortgage better than those that dabble in this product.
During this initial meeting is your opportunity to ask questions about the product as well as an opportunity to learn more. There is typically quite a bit of fact finding going on as well. The loan officer is trying to understand what your current financial situation is, what problems you are currently facing or will be facing in the future and how the reverse mortgage could be used or structured to best meet your needs. And finally, all the relevant numbers and interest rates for your loan can be calculated.
During this initial meeting, a reverse mortgage analysis is usually generated that covers your loan options, fees and potential outcomes of the reverse mortgage.
The reverse mortgage analysis packet contains quite a bit of information which should include the following:
- Frequently asked questions
- Various charts
- Loan options
- Amortization schedule
- Fee sheet
- TALC sheet
- List of HUD counselors
- Preparing for your HUD counseling
- Using Your Home to Stay at Home booklet from the National Council on Aging
If you decide that the reverse mortgage makes sense, your next step will be to schedule counseling. Once you have completed your counseling, you will receive a Certificate of Counseling.
Some states require the counseling to be completed prior to an application. Others do not. However, even if you do complete an application prior to counseling nothing can be done beyond pulling your credit until the counseling is complete.
Title / Appraisal
Once the application and disclosures have been completed and the counseling certificate has been received a title report will be requested and an appraisal will be ordered.
Typically a loan will not be underwritten until an appraisal has been received. However, if there are issues either you or your loan officer are concerned about, a credit underwrite can be completed.
After the file has been underwritten you will receive a conditional approval. This means you are approved for the loan as long as certain conditions are met or additional documentation is provided.
Clear to Close
After all conditions have been met and the underwriter has signed off on all conditions a clear to close is issued at which point your loan officer will schedule a time for you sign the final loan documents either with a mobile notary, title company or attorney.
How Long is the Reverse Mortgage Process?
There is not definitive answer to this as it will depend on where you live.
For example, in Oregon an appraisal usually takes 2 weeks to be completed. In more rural areas of Oregon it could take 6 to 12 weeks to get an appraisal. On average a loan take 30 to 45 days from start to finish in Oregon.
Your loan officer can give you a better answer on how long it will take to complete your reverse mortgage loan.