Having a Look at the Different Types of Hawaii Reverse Mortgages

When you need money, and you have a home, there are certain financial avenues open to you.  These only increase with age.  If you are a senior citizen who owns a home in Hawaii, then you can take advantage of a reverse mortgage in Hawaii.

Reverse mortgages can be very confusing.  However, simply put, a reverse mortgage is a home loan that can provide you cash right now for your personal use.  There are currently no income or credit requirements and you do not have to pay back the loan until you sell your property.

What few people know are that there are three primary kinds of reverse mortgages in Hawaii. These include the single purpose reverse mortgages, the home equity conversion mortgages, and the private proprietary reverse mortgages.  Lets take a closer look at each.

The Single Purpose Reverse Mortgage

Of the three, it is considered the cheapest option.  However, single-purpose reverse mortgages are only available in some areas through state and local government agencies.  It is also the most straightforward.  You get the reverse mortgage, and the bank pays you installments of the worth of your home.  When you move past the house and sell it, the bank collects what they owe from the value of the home.  Though single purpose reverse mortgages Hawaii are the cheapest, they can only be used for a single purpose.  That means you have to specify what the purpose is, like home repair or paying off property taxes.

The HECM, or Home Equity Conversion Mortgage

This is no doubt what you are familiar with and is by far the most flexible and therefore, the most popular.  The HECM is specific for each state.  For example, Hawaii will have its own rules regulating the use of a HECM.  A HECM means that you can turn a portion of your home equity into cash that you can use for any purpose.  It was originally designed to allow people retiring to get more equity from their property.  As a result, the HECM is widely used.

Private Proprietary Reverse Mortgage

When getting an FHA Insured HECM, there is a maximum claim amount of $625,500.  If your property is worth more than that, and you have adequate equity remaining, you may be able to reserve more fund with a proprietary reverse mortgage.  This type of reverse mortgage allows for higher lending payouts, as well as more use of the equity in the home that can be converted to cash.

The Next Step

For more information or for a FREE, No-Obligation Quote, contact:

Daniel Nicolosi
Hawaii Reverse Mortgage Specialist
Certified Senior Advisor
Harbor Financial Group – Your Aloha Mortgage Solution
700 Bishop Street, Suite 210
Honolulu, HI  96813
You can reach Daniel directly at (808) 799-8218 on Oahu; or Toll Free at 888-423-2468 on the Outer Islands.

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