- A reverse mortgage allows homeowners aged 62 or older to convert their home equity into tax-free cash without making monthly payments. The lender pays the homeowner instead through options like lump sums, monthly payments, or a line of credit. - Borrowers retain ownership of their home and cannot owe more than its value. They must continue living there as their primary residence and pay taxes/insurance. The loan is repaid when the last borrower dies, sells the home, or fails to meet obligations. - The amount borrowers can access depends on their age, home value, interest rates, and lending limits. They have flexibility to use funds for any purpose like eliminating debt or home improvements.

1. Reverse Mortgage Financing Solutions Enjoy a More Comfortable Retirement in Your Own Home

2. What is a reverse mortgage? It’s a home loan that enables you to convert a portion of your home’s equity into tax-free funds without having to sell your home, give up the title, or take on a new monthly payment. Instead of making monthly mortgage payments, your mortgage pays you. That’s the “reverse” part of a reverse mortgage.

3. How a reverse differs from a traditional mortgage With a traditional mortgage or home equity loan – Homeowners qualify based on their credit history and debt-to-income ratio. They borrow money which requires making monthly payments. With a reverse mortgage – Your mortgage makes payments to you and there are no income, employment or credit score qualifying restrictions.

4. Why get a reverse mortgage? A reverse mortgage can give you access to your home’s equity without the burden of monthly payments. Reverse mortgage proceeds may be used for any purpose, including: Eliminating your existing mortgage Meeting daily or monthly expenses Covering healthcare expenses Remodeling or home repairs Reducing credit card debt With the reverse mortgage for purchase feature, the loan proceeds are used to help purchase a new primary residence better suited to your needs.

5. How the loan proceeds are disbursed? You have several options to receive your reverse mortgage proceeds, they are available to you in the following distribution options: Lump Sum – A specific amount is made immediately available (often used to pay off an existing mortgage). Term – Funds are released in fixed monthly amounts for a set period requested by the borrower. Tenure – Funds are distributed in fixed monthly allotments for as long as at least one homeowner continues to occupy the home as a primary resident. Line Of Credit – Funds remain available for the customer to draw on as needed or in automatic monthly disbursements. Combination – You can choose any combination of lump sum, monthly or line of credit disbursements. You can even receive an initial lump sum and put the rest in a line of credit. Regardless of how you choose to receive your proceeds, you can adjust your plan as often as you wish to accommodate changing needs.

6. Three essential facts As long as all program requirements are met: You retain the title to the property and continue to own your home Instead of making mortgage payments, you can have a mortgage that pays you. You cannot owe more than the value of the home. Program requirements include but are not limited to: One of the borrowers continuing to live in the house Keeping the taxes and insurance current Maintaining the property according to FHA standards If the program requirements are no longer being met and you or your heirs choose to retain ownership of the home, the outstanding loan balance must be paid.

7. Age and eligibility requirements You and any co-owners must be at least 62 years old Your home must be your primary residence Educational counseling with a HUD-approved counselor is required and only takes 30 minutes

8. How much can I borrow? The amount that can be borrowed is determined by a HUD formula that is based on the following factors: The age of the youngest homeowner The appraised value of the home The current interest rate The established lending limit

9. What are the interest rate options? Eastern Trust Lending offers both fixed- and variable-rate reverse mortgages. With a fixed-rate reverse mortgage, your interest rate will remain the same through out the life of the loan. With a variable-rate reverse mortgage, the interest rate may adjust at pre-determined periods. In most variable-rate cases, you may choose monthly or annual rate adjustments. The frequency by which you interest rate adjusts – monthly or annually – will not affect the number of loan advances you receive.

10. The costs involved with a reverse mortgage There are closing costs which may be financed into the loan such as: Title insurance Mortgage insurance premium Attorney fees You are expected to continue maintaining the property and paying the real estate taxes and homeowners insurance premium.

11. Reverse mortgage repayment You do not need to repay the loan as long as the program requirements are met, including: You or one of the borrowers continues to live in the house as your primary residence. You keep the property taxes and homeowners insurance current. You maintain the property. The balance due can come from home sale proceeds, or from other resources, such as savings, insurance or possibly applying for a new mortgage. There is no requirement that the home be sold, only that the loan be repaid. Home equity, along with your other possessions, belongs to you or your heirs .

12. The reverse mortgage loan process 1. Meet with a Reverse Mortgage Specialist at Eastern Trust Lending to apply for your loan. - Fill out an application - Select a plan right for you - Present required documentation Receive consumer counseling from a HUD-approved counselor. Underwriting process begins. Loan approval, a closing is scheduled. Your loan funds and proceeds are disbursed.

13. Frequently Asked Questions Who owns the home? You do. You retain the title and ownership of your home. The bank does not own your home. Can the bank take my home? Will I be forced to sell my home if the money I owe on the loan exceeds the value of my home? No, as long you continue to occupy the home as your primary residence, pay the appropriate taxes and insurance.

14. Frequently Asked Questions Are there restrictions on how I can use my reverse mortgage proceeds? Absolutely Not ! It’s your money to use as you see fit. Some common uses include: Eliminating your existing mortgage Meeting daily or monthly expenses Covering healthcare expenses Remodeling or home repairs Reducing credit card debt Setting up an emergency fund Going on a much needed vacation

15. Frequently Asked Questions What if the value of my home increases during the mortgage term? No matter if, or how much, your property has appreciated in value, you or your estate are only required to pay back the outstanding balance due on your reverse mortgage at the time the home is sold . Any excess proceeds from the sale of your home belong to you or your estate.

16. Frequently Asked Questions Will receiving my reverse mortgage proceeds in monthly payments affect my Social Security or Medicare benefits? If you opt to receive monthly payments, they will not affect your Social Security or Medicare benefits. However, your monthly eligibility for need-based programs such as Medicaid or state assistance programs may be impacted. We recommend that you consult a tax or legal advisor and your local Area Agency on Aging for advice. We can assist you in researching this and getting the correct information.

17. Frequently Asked Questions What if I decide to sell my home? You always retain the title to your home during the period of your reverse mortgage loan. You can sell your home at anytime and pay off the reverse mortgage with the proceeds and you or your heirs receive the equity.

18. We can help you choose the reverse mortgage financing solution that best fits your individual needs and requirements. 07/11 James Stout Reverse Mortgage Specialist Tel: (954) 993-6150 Fax: (888) 578-9669 3327 NE 32 nd Street, Fort Lauderdale, FL 33308 [email_address] www.EasternTrustLending.com