[Bruce Hancock]

Next one:
B. When you get a reverse mortgage loan, you have three options for accessing your money: cash, monthly payments, or as a line of credit.
Establishing a HECM line of credit earlier rather than later allows you to grow your line of credit over time. It also allows you to lock in your home’s current value since the HECM benefit doesn’t drop if home prices go down. It’s a little known fact that a reverse mortgage line of credit grows year after year. Some think of it as a guaranteed annual limit raise on your credit card.

This line of credit is similar to a traditional Home Equity Line of Credit (HELOC) but there are some interesting differences. Once your reverse mortgage line of credit is established it cannot be revoked unless you default on the terms of your loan. What’s more, a reverse mortgage line of credit does not have income requirements as long as you can prove your creditworthiness by submitting to a lender’s financial assessment.

The line of credit grows every year because the unused portion of the credit line grows with your loan interest plus the mortgage insurance premium renewal. That means the longer you wait to tap your line of credit, the more credit you have to borrow against.

Once you lock in your appraised value for the purpose of a reverse mortgage, market value decreases do not affect what is available to you on your monthly payments or reverse mortgage line of credit going forward.