Servicing Set Aside

2008-05-08T16:22:00-05:00

We get a lot of questions about the servicing set aside on HECM Mortgages. Each reverse mortgage has a servicing fee, usually $35 per month. This means that every month you have your mortgage the loan servicer earns a $35 fee, well someone has to pay this fee.

The whole idea behind having a reverse mortgage is to not make any payments. It would be pretty silly to bill a borrower every month for just $35! So they way FHA does this on HECM mortgages is to leave enough room in the loan for the $35 to be added to the balance every month to pay the servicing lender.

The way the calculation works is to add up all of the $35 charges from the time you get the reverse mortgage until age 100. But the fee doesn't get charged up front so you don't pay interest on all that at once. You only pay interest on it as it is charged every month. So the lender has to run a complex formula to figure out how much it will take to pay all of the $35 servicing fee but give you a credit back for the interest you don't pay on it.. Confusing huh? I think so, thank goodness for the computers that calculate it. This is why the amount isn't as simple as $35 times the number of months until your 100th birthday.

Reverse Mortgage Calculator Info

2008-04-17T19:15:00-05:00

A Reverse Mortgage Calculator is a great way to find out how much money you would receive if you took out a reverse mortgage. The reverse mortgage calculator must be updated weekly as interest rates change and follow all of the rules set in place bu HUD. Not all reverse mortgage calculators are accurate.

We make sure that our reverse mortgage calculator is updated frequently and that all of the estimates are accurate. Our calculator only calculates the monthly adjustable HECM since it is the most popular product. We are in the process of adding a fixed rate reverse mortgage calculator.

If you are curious about how much money you could qualify in a reverse mortgage feel free to check out ourreverse mortgage calculator. All you need to input is your date of birth, value of your property, amount of existing mortgages and zip code. It will do the rest and calculate how much you qualify for, its that simple!

Florida Reverse Mortgage

Servicing Set Aside

Reverse Mortgage Calculator Info