California is offering reverse mortgage assistance for homeowners struggling to pay their property expenses under their reverse mortgages and thus are at the risk of losing their homes. Under this Reverse Mortgage Assistance Pilot Program (RevMAP), eligible residents are given a forgivable loan so they can reinstate past due taxes, homeowner’s insurance, and other relevant property-related charges.
Reverse Mortgage Assistance Program
The program will grant up to $25,000 in reverse mortgage assistance to eligible homeowners with FHA Home Equity Conversion Mortgages. This will put them back on track with their property’s charges – real estate tax, homeowner’s insurance, homeowners’ association/condo fees, flood insurance — whose payments have been advanced by the loan servicer.
Proceeds from a RevMAP loan are made directly to the loan servicer as reimbursement to property charges paid on behalf of the homeowner. The loan may also cover future property charges for up to 12 months of an eligible senior homeowner.
Loans under RevMAP are non-interest bearing and forgivable after two years from the date they were issued. However, if you decide to sell the home or refinance your mortgage prior to this two-year period, you will be required to repay the loan from the refi/sales proceeds.
RevMAP is part of Keep Your Home California, a collective name of programs geared toward helping low-and-moderate income homeowners experiencing hardships as a result of unemployment, the housing downturn, etc.
Relatedly, RevMAP requires a showing of involuntary hardship — exhausted HECM funds, income reduction, death within and out of the household, and medical disability — on the part of the applicant with a fully signed and completed affidavit as proof. The program’s other eligibility requirements include but are not limited to:
You must occupy the home as your primary residence.
You must meet low and moderate income limits.
You must show adequate income to make required property expense payments going forward.
You must complete a tax and insurance default counseling required by the FHA.
Your home must be located in California.
As it is required that you occupy the home as your main house, it must not therefore vacant, uninhabitable, abandoned or condemned.
Your home is subject to an FHA HECM serviced by an HUD-approved servicer.
Your mortgage must be an FHA HECM.
Your mortgage balance must be $625,500 or less.
Your delinquent property expenses must have been advanced by their loan servicer.
To promote RevMAP and provide a forum where residents can get answers to their reverse mortgage questions and concerns, HOPE NOW Alliance and Clearpoint are organizing a series of educational seminars in California.
The first reverse mortgage assistance/counseling event is scheduled for June 24, in Reseda, part of Los Angeles, California. To get posted for next homeowner events, go to HOPE NOW’s website.