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The Reverse Mortgage Process
Back Home
| CASH ACCOUNT PLAN |
The Cash Account Plan offers several options to provide seniors with a broad range of choices to access significant home equity opportunities. The Cash Account is similar to home equity loans offered by banks. The benefit is a function of the home value and age with no income qualification.
No repayment is required until the borrower permanently moves out of the home.
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| FEATURES AND BENEFITS |
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Designed for borrowers age 62 years or older |
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Virtually no maximum home value or loan limit |
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Special six-month introductory rate (6 month LIBOR [index] – 4.5 [margin]) |
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Life time interest rate cap is 6% over the initial annual percentage rate (6 month LIBOR[index] + 5% [margin]) |
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No equity or appreciation sharing and no maturity fee |
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Proceeds/Advances are not taxable |
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No payment penalty |
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Loan is non-recourse |
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Servicing fee is automatically financed on the account monthly (no servicing fee in Illinois and Maryland) |
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Eligible home types: single family detached, Manufactured, Condo, PUD, 1-4 rental unit if one is Owner occupied, Co-ops in New York state |
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Counseling by an independent counselor |
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Minimum home value at origination: $75,000 |
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*Not all products and options available in all states. |
| SIMPLY ZERO PLAN |
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Origination fee = none |
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Draw at Closing =100% of maximum available. |
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Closing Cost = none (excluding local or state taxes, if any). |
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No prepayment penalty. Partial prepayment not allowed first five years.Full prepayment permitted |
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Adjustable interest rate = 6-month LIBOR(index) + 5% (margin). Rate is reset semiannually. |
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| ZERO POINT OPTION |
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Origination fee = none |
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Minimum draw at Closing = 75% of maximum available |
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Minimum draw after closing is $500 |
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Unused line of credit grows by 5% annum on the pledged value |
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Closing costs = actual 3rd party costs not to exceed $3500 (excluding local or state taxes, if any) |
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No prepayment penalty. Partial prepayment not allowed on minimum draw at closing for first five years. Full prepayment permitted. Rate is reset semiannually. |
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Adjustable interest rate = 6-month LIBOR(index) + 5% (margin). Rate is reset semiannually. |
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| EQUITY CHOICE ***NEW*** |
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Available for all Cash Account Options, Equity Choice allows the borrower to limit the percentage of home value pledged as collateral for the loan resulting in the amount of the loan or line of credit being less then the amount for which the borrower otherwise qualifies. Borrowers may choose to protect a minimum of 10% and a maximum of 50% l of their home equity. This permits greater flexibility assuring a percentage of equity remaining to benefit the borrower or heirs upon loan maturity. |
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Not all products and options available in all states.
The six-month introductory rate as of April 12, 2005 was 7.89%(7.89% APR).
The interest rate after the six-month introductory rate as of April 12, 2005 was 8.39%(8.39% APR).
The maximum APR that can apply is 14.39%. These rates may vary.
A balloon payment will occur at maturity.
Consult your tax advisor. |
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