- Reverse mortgage
- What is a reverse mortgage?
- Who is eligible for a reverse mortgage loan?
- Key features of the reverse mortgage under the Reverse Mortgage Programme
- What costs is the borrower responsible for?
- How much does the borrower receive every month?
- Lump-sum loan
- Assignment of life insurance policy
- When does the reverse mortgage terminate?
- What happens to the property at the end of the reverse mortgage?
- Application procedures
- Public housing issues
- Maintenance and safety of property
- Redevelopment and acquisition of property
Key features of the reverse mortgage under the Reverse Mortgage Programme
- Payment term
- Lump-sum loan
- Living in the borrower’s own home
- No repayment during the borrower’s lifetime
- No penalty for early full repayment
- Six-month cancellation period
The borrower can choose to receive monthly payouts for either a fixed period of 10, 15 or 20 years, or for his entire life, according to his needs. The borrower has the flexibility at any time during his existing payment term to apply to switch to another payment term.
In addition to monthly payouts, the borrower may apply to borrow a lump-sum amount for a specific purpose, such as to fully repay an existing mortgage, to pay for repair sor maintenance to his home, or to pay for medical expenses.
After taking out a reverse mortgage, the borrower is still the owner of his property, and is entitled to continue to live in his homefor the rest of his life.
If there are two borrowers and one of the borrowers has passed away, the surviving borrower is entitled to continue to live in the property for the rest of his life.
The borrower does not need to repay the outstanding amount he owes to the bank during his lifetime, unless the reverse mortgage loan is terminated under certain specified circumstances, such as his moving out of the property.
The borrower may repay the outstanding loan amount in full to redeem the property at any time with no penalty.
The borrower may terminate the reverse mortgage loan for any reason within the first six months.Provided that the borrower notifies the bank within the first six months and repays the mortgage in full on the proposed repayment date, he will be given a refund and waiver of all mortgage insurance premiums. However, the borrower still needs to pay the relevant legal fees.