A Reverse Mortgage Saver (HECM Saver) vs. Equity Line of Credit in Utah: Which Is Right For You?
In 2010, the FHA introduced a new type of reverse mortgage in Utah called the HECM Saver (the standard reverse mortgages in Utah are called the HECM Standard). The HECM Saver is a program for seniors who want to borrow a smaller sum than the minimum for the HECM Standard. It also has lower closing costs and a lower initial mortgage insurance premium (MIP) than the HECM Standard: .01% for the HECM Saver as compared to 2.0% for the HECM Standard. Because of these features, the HECM Saver reverse mortgage in Utah can be an appropriate alternative to an equity line of credit in Utah. Use this chart to help you determine which type of loan is right for you:
A Reverse Mortgage Saver In Utah (HECM Saver):
- Must be 62 years of age or older to apply.
- No monthly loan payment is due on the interest or principal.
- Reverse mortgages in Utah do not need to repaid until the homeowner has permanently moved out of the house or passed away. The homeowner is responsible for paying property taxes, insurance, and maintaining the home.
- Credit scores are not usually a factor in approval.
- Income is not generally a factor in approval.
An Equity Line of Credit in Utah:
- No age requirements.
- A monthly loan payment is required.
- Must maintain a certain amount of equity in the home or the equity line of credit in Utah may be closed by the lender.
- Credit score is used to determine approval.
- Income is used to determine approval.
- Some homeowners will find it hard to qualify for an equity line of credit in Utah.