Reverse Mortgage Process

Step 1: Reverse Mortgage Counseling

The reverse mortgage process starts even before an application is submitted. Reverse mortgage lenders cannot begin processing an application for a reverse mortgage until the homeowner has completed the required federal Housing and Urban Development (HUD) counseling and submitted a completed reverse mortgage counseling certificate. Counseling required in the reverse mortgage process is available face-to-face or by phone, and with national, regional, or local agencies.

Step 2: Application

The next step in the reverse mortgage process is completing an application. The application authorizes the lender to start the reverse mortgage process, but it is not binding, and can be cancelled by you at any point during the process. Your lender will provide you with the application and a list of documents you may need to provide. Your lender will also provide you with instructions and should be available to answer any questions you have about the application process.

Step 3: Appraisal

The third step in the reverse mortgage process is the home appraisal. An appraisal is an independent and objective determination of the fair market value of a home. A reverse mortgage appraisal must be conducted by a Federal Housing Administration (FHA) approved-appraiser and most conform with FHA guidelines. Many lenders have relationships with approved appraisers and can recommend one in your area.

Step 4: Underwriting

The next step in the reverse mortgage process is called underwriting. During underwriting, an underwriter reviews the reverse mortgage application and file for accuracy and completeness. The underwriter will identify conditions that need to be satisfied, and note any additional documentation that is needed. Underwriting is the last step in the reverse mortgage process before closing.

Step 5: Closing

Closing is the last step in the reverse mortgage process before funds are disbursed. At closing, an attorney or notary meets with the borrower to sign the final closing documents. The borrower will review the closing packet, all terms and conditions, and sign the forms.

After signing, the borrower has a three-day “right of rescission” period in which the borrower can still walk away and withdraw the application without penalty. After that three-day period, the title company will issue a check to the borrower according to the terms of the agreement. The reverse mortgage process is then complete.

Need More Information About the Reverse Mortgage Process?

If you need help understanding the reverse mortgage process, a friendly representative from Citizens Lending Group is here to provide you with more information. Call us at (800) 480-6828 to learn more about reverse mortgage requirements and the entire process or use our convenient online contact form.