HECM Loans

A Home Equity Conversion Mortgage (HECM) stands out as the sole reverse mortgage backed by the U.S. Federal Government. If you own a home in Los Angeles, CA, or the surrounding areas, you might qualify for this secure loan option through The Friendly Lender.

Unlock Your Home's Value with a HECM Loan from The Friendly Lender

Are you a homeowner aged 62 or older? A Home Equity Conversion Mortgage (HECM), the FHA-insured reverse mortgage, could be the perfect solution to access your home’s built-up value. Imagine enjoying greater cash flow and even living in your home without a traditional monthly mortgage payment! You could also receive regular payments directly from the equity you’ve invested over the years.

With a HECM from The Friendly Lender, you retain full ownership and title to your home, just as you always have. The loan only becomes due when the home is sold, the last borrower permanently moves out, or the loan terms aren’t met (like keeping up with property taxes, homeowner’s insurance, and home maintenance). This means you can continue to enjoy the comfort and familiarity of your cherished home.

Peace of Mind with FHA Insurance

HECM loans are insured by the Federal Housing Administration (FHA), providing significant protections for you and your family. While a Mortgage Insurance Premium (MIP) is collected at closing and throughout the loan’s life (charged to your loan balance), this insurance offers crucial safeguards:

  • No “Upside Down” Risk: You’ll never owe more than your home’s fair market value. If the loan balance exceeds your home’s value, the FHA covers the difference.

  • Guaranteed Payments: FHA ensures that you’ll continue to receive your payments, even if the lender faces difficulties.

  • Stay in Your Home: As long as you meet basic loan obligations (like paying taxes and maintaining the home), FHA guarantees you can live in your home, even if the loan balance grows beyond its current market value.

  • Heir Protection: If your heirs wish to keep the home when the loan becomes due, they can do so by paying 95% of the appraised value (less standard closing costs and real estate commissions).

A reverse mortgage truly allows you to tap into your home’s value without the need to sell it. It’s designed for situations where you might be facing rising bills or healthcare costs and don’t want to leave the home you’ve known for years. With a HECM, you can put your home’s equity to work for you, using the proceeds as you wish – whether for retirement enhancements, home improvements, or managing expenses.

To ensure you’re making an informed decision, all reverse mortgage applicants are required to obtain counseling from an independent, HUD-approved third-party counselor. While HECM proceeds are generally not subject to personal income tax, we recommend consulting with a tax advisor regarding any impact on government needs-based programs.

Ready to see how a HECM loan from The Friendly Lender can benefit you? Call us at 818-952-8666 or email david@thefriendlylender.com to learn more.