Reverse Mortgage Loans
Reverse Mortgages in Durango & Southwest Colorado
Reverse Mortgages
These loan programs are available to customers over 62 years of age to help improve financial security, quality of life and ease of mortgage payments. The total amount of money you can receive from your house is limited and determined by the age of the youngest borrower or eligible non-borrowing spouse, the value of the house, and the interest rate at the time of closing.Â
- Improved cash flow - improved quality of life
- Pay off your current mortgage
- Receive lump sum cash at closing
- Receive cash as needed
- Receive a monthly check
Could a reverse mortgage fit me?
Five questions about the basics. There are no wrong answers.
Are you, and anyone on the loan with you, 62 or older?
Is this the home you live in most of the year?
How much do you owe on the home?
Can you keep paying property taxes, insurance and any HOA dues?
What kind of home is it?
A reverse mortgage is a loan. You keep the title and must live in the home, keep it up and pay property taxes, insurance and HOA dues. The loan is usually repaid when the last borrower moves out or passes away. This material is not from HUD or FHA and was not approved by HUD or a government agency.
Proceeds Generally Aren’t Taxed
Reverse mortgage proceeds are loan advances, not income, so they generally aren’t subject to income tax and can be used for almost any purpose. Check with a tax advisor about your own situation.
- Pay for basic living expenses
- Cover home repairs or updates
- Pay for medical expenses not covered by insurance
- Help finance your grandchildren's education
- Fulfill lifelong dreams that were previously unreachable
Homeowner Maintains Ownership Of The Home
Because you keep ownership, any increase in your home’s value belongs to you. You must keep the loan terms: live in the home as your primary residence, pay property taxes and homeowners insurance, and maintain the property.
Interest and fees are added to the loan balance over time, so the balance grows and the equity you have left usually goes down, unless your home’s value rises faster. Peter will show you how that could look before you decide.
Reverse mortgages for Durango and La Plata County homeowners
I’m Peter Pritchard, and I’ve helped Durango-area families with home loans for 28 years. A reverse mortgage can be a good tool for some homeowners 62 and older, and the wrong one for others. I’ll walk you through it honestly, and I’m glad to meet with your adult children or financial advisor too.
How a reverse mortgage works
- Most reverse mortgages are FHA-insured Home Equity Conversion Mortgages (HECMs).
- You keep the title to your home. No monthly mortgage payment is required.
- You still pay your property taxes, homeowners insurance and any HOA dues, keep the home in good repair, and live in it as your primary residence.
- The loan comes due when the last borrower sells, moves out permanently or passes away.
- A HECM is non-recourse: neither you nor your heirs will owe more than the home is worth when it’s sold.
- Before you apply, federal rules require a counseling session with an independent HUD-approved counselor.
The trade-offs to understand
- Upfront costs include FHA mortgage insurance and closing costs.
- Interest builds on the balance over time, so there is usually less equity left for heirs.
- If taxes, insurance or upkeep aren’t kept current, the loan can come due.
Ways Durango homeowners use them
- Pay off an existing mortgage to free up monthly cash flow
- Set up a line of credit for future health care or home repairs
- Buy a home that fits retirement better, such as a single-level house closer to town, with a HECM for Purchase
Questions? Call or text me at 970-828-1610, stop by 1099 Main Avenue, Suite 305 in Durango, or send me a message.
Not sure where to start? See how I compare mortgage lenders in Durango for you.
Peter Pritchard NMLS #404172 | Animas Mountain Mortgage Inc. NMLS #1742747 | Equal Housing Opportunity. Borrowers must be 62 or older, occupy the home as a primary residence, and remain current on property taxes, insurance and maintenance. This material is not from HUD or FHA and was not approved by HUD or a government agency.
How much could a reverse mortgage give you?
Most people are surprised how much smaller the amount is than their home's value. This estimate uses HUD's lending limit and principal limit tables for FHA-insured reverse mortgages (HECMs). It's not an offer, and nothing is saved or sent.
Reverse Mortgage Questions Durango Homeowners Ask
Who qualifies for a reverse mortgage?
You must be 62 or older, live in the home as your primary residence and have enough equity. For an FHA-insured reverse mortgage (HECM), you also complete a counseling session with a HUD-approved counselor before you apply.
Do I still own my home?
Yes. The title stays in your name. You stay responsible for property taxes, homeowners insurance and upkeep, and the loan can become due if those are not kept up.
What happens when I move out or pass away?
The loan becomes due. You or your heirs can sell the home and keep any remaining equity, pay off the loan to keep the home, or sign the home over. With an FHA-insured HECM, neither you nor your heirs will owe more than the home is worth when it is sold.
Can my spouse stay in the home if they are younger than 62?
Often, yes. HECM rules include protections for an eligible non-borrowing spouse, but they come with conditions. Peter will walk you through them before you apply.
Can I use a reverse mortgage to buy a home?
Yes. A HECM for Purchase lets homeowners 62 and older buy a new primary residence, such as a smaller home in Durango, with no monthly mortgage payment required. You still pay taxes, insurance and upkeep.