Reverse Mortgage Costs

All home loans will have closing fees and other fees associated with the loan.In most cases the typical home mortgage has quite a lot of fees that are not included in the loan and these fees are required to be paid by the borrower upfront.However, the reverse mortgage costs will not come from your pocket book. In most cases, fees that come with your seeking a reverse mortgage loan are simply added into your loan.

There are a few small fees that may need to be paid upfront, but they are small compared to a typical home mortgage loan.

The Possible Reverse Mortgage Costs From Out of Pocket

Although you will gain some incite into what types of fees you can expect to have when obtaining your reverse mortgage loan, until you talk to your counseler, you won't know exact figures on loan fees. While not having to pay the fees upfront is a great advantage, it will lower the amount you will be able to obtain from the bank as it is taken out of the amount you will qualify for.

Credit Reports - Although your income is not a consideration, nor your credit history, concerning your qualifications of obtaining a reverse mortgage, the banks are interested in any outstanding federal tax liens that may be on your home. They are also interested in any other types of judgements that may be on your home. It is for this reason that a bank will need to run a credit report. The fee for this can vary but will be somewhere around $20.00.

Possible Reverse Mortgage Costs That May Be Included Into Your Loan

The following information contains possible fees and possible amounts. However, consider each a ball park figure and nothing more. Each state, each city and even each loan lender will vary in the amounts charged as well as the types of fees that will be included.

Depending on your location you may be required to obtain a flood certification, which will cost around $20.00.

Origination Fee - The FHA rules that the originator may charge you up to 2 percent of the total lending limit or your homes value, whichever of these is less.

Home Appraisal - You will be required to have your home appraised to learn the current value of your home. This fee can be as low as $300.00 and run quite a lot higher depending on the area you live and the size of your home. Your home must meet FHA standards before you can obtain a reverse mortgage loan.

Things you want to make sure are in good shape before you spend any money on an appraisal would be your roof and foundation of your home. No leaks or cracks that would damage or weaken the structural integrity of your home. Your home and property will of course also need to be up to your city codes.

Courier fees which run around $50.00 to $100.00 include having your documents mailed overnight to push the loan along quickly.

Document preparations can cost between $50.00 to $100.00 or so. Pest inspections, $100.00, survey for the property line, $250.00, title insurance, which will depend on the size of your loan, the higher the loan amount the higher the fee for title insurance.

Reverse Mortgage Costs You Want Included in Your Loan

Finally, there is something called MIP or Mortgage Insurance Premiums. This is worthy of another article, because it involves making sure you never actually end up owing the bank more than you borrowed should your home decrease in value and for some unknown reason you will need to sell your home at some point.