Give your budget a second to breathe

HomeSafe Second is a groundbreaking home equity solution for those who need additional cash to fight inflation and address economic uncertainty.

It’s a loan that complements your existing mortgage, unlocking a piece of your stored equity without the burden of a new monthly payment or the need to refinance, and while the loan balance grows over time, it doesn’t need to be repaid until you leave your home.

What Can You Do With HomeSafe Second

• Fight Inflation: Instantly improve your monthly cash flow and find relief as costs rise.
  
• Consolidate Credit Card Debt: Pay down high-interest debt and improve financial flexibility.
  
• Preserve Your Low-Rate First Mortgage: Access equity without refinancing at higher rates.
  
• Avoid Another Payment: Boost your budget without the burden of a new monthly payment.
  

A second mortgage that puts you first.

Samantha put her inflation worries at ease.

To illustrate the benefits of HomeSafe Second, take Samantha’s hypothetical situation. A few years back, she took advantage of historically low interest rates and refinanced her mortgage. Her finances were in order to retire at 67, but recent inflation is now cutting into her monthly budget. By accessing home equity with HomeSafe Second, Samantha gets the cash she needs to find relief from inflation without needing to refinance her current low-rate mortgage or add the burden of a new monthly payment.

Frequently Asked Questions About HomeSafe Second

1. How is a HomeSafe Second reverse mortgage different from a traditional home equity line of credit (HELOC)?

A reverse second mortgage offers greater flexibility in repayment – no monthly mortgage payments are required on this loan. You must continue to pay the existing first mortgage payment, property taxes, homeowners’ insurance, flood insurance (when applicable), HOA dues and maintain the home.

2. How and when does a reverse mortgage need to be repaid?

As long as the terms of the HomeSafe Second reverse loan and any first lien loan are met, a reverse second mortgage does not have to be repaid until the home is no longer the primary residence of at least one borrower or the home is sold. Usually, the last surviving borrower or their estate sells the home to repay the loan(s). Existing liens may also be repaid from other assets, proceeds from a life insurance policy, or a loan refinance subject to any first lien loan-related restrictions.

3. What if I owe more on my reverse mortgage than my home is worth?

Reverse mortgages have a non-recourse feature, which means that the total amount that you owe on the reverse mortgage can never exceed the appraised value of your home. However, if your home increases in value, all equity that remains once the reverse mortgage and first liens are paid off belongs to you and your estate.

4. What if I no longer live in the home as my primary residence?

If you permanently leave the home, the reverse loan servicer will issue a Repayment Notice that states the mortgage is due and payable.

5. What are the costs associated with a reverse mortgage?

In addition to interest, the costs can include a property appraisal fee, origination fee, closing costs, servicing fee and a modest charge for independent counseling. While closing costs vary based upon the type and size of the loan, they’re similar to those for any traditional mortgage. You can roll most of the up-front costs into the loan, so out-of-pocket expense can be minimized, and you can reduce your costs by taking a lower amount of proceeds that are available to you. We will give you a detailed cost breakdown and explain the different interest and pricing options available.

6. What are my responsibilities once I get my reverse mortgage?

As a reverse second mortgage borrower, you can enjoy all the benefits a reverse mortgage can bring to your life, including making no monthly mortgage payments on the reverse mortgage. However, you must, continue to live in the home as your primary residence, pay your homeowner’s insurance, real estate taxes, and any applicable HOA or condominium assessments and fees, keep your first mortgage current when permitted by law, maintain your home, and comply with the obligations in the security instruments. A reverse second mortgage does not change any of the requirements associated with your first lien mortgage, including the requirement that you make timely payments to your first lien servicer.

7. Will I still own my home?

Since payments are not being made on the reverse second mortgage, it’s common for some reverse mortgage borrowers to feel like they no longer own their home. This is not the case. A reverse mortgage is just like any other mortgage, meaning that there is a lien on your house that has to be paid back at some time, but you still own your home subject to the lien(s) and your name remains on the title.

8. Can I lose my house?

You may also be concerned that you could somehow lose your home if you obtain a reverse mortgage. The reverse lender will not be able to foreclose on your home, even if the unpaid balance exceeds the value of your home as long as you continue to manage your responsibilities: live in the home as your primary residence, pay your property taxes, homeowner’s insurance, flood insurance (when applicable), HOA dues, maintain your home, and meet all of the first-lien mortgage obligations (when permitted by state law). If you do not meet these obligations, the loan servicer will attempt to contact you to resolve the situation. We highly recommend you keep an open line of communication with the servicer when any issues arise.

9. Will I be able to leave anything to my family?

Another common concern is that there will be nothing left of your estate to leave to your heirs once you pass away, or worse, you will end up saddling them with even more debt. The non-recourse feature of a reverse mortgage assures that you and your estate will never owe more than the value of your house. In the event the debt exceeds the value of the home, your heirs simply walk away. This is a worst-case scenario. This relates to the second lien mortgage only. Your first lien mortgage, which has not been replaced or extinguished, may be a recourse loan.