What is the SELOC
(SENIOR HOME EQUITY LINE OF CREDIT)?It is a unique program which
provides the older homeowner with a source of funds to cover unexpected property
and life-related expenses. Along with this line of credit, H.O.M.E. counselors
provide financial advice and guidance in making prepurchase decisions and
helping you to make informed financial decisions.
Day-to-day living is easier when you know that the problem of unanticipated or
sudden expense worries is now behind you.
I have a small fixed income and Im
worried about large future expenses. Can I qualify?
The SELOC is designed for people
in your situation. The loan amounts are modest and greater weight is placed on
the preservation of the majority of your home equity.
I have need for a small supplement
almost every month. Would a SELOC be appropriate?
No. The SELOC is for unusual,
irregular expenses. It is not designed to supplement your income monthly on an
How does the rate for the SELOC
compare with other equity lines?
Interest rates on the SELOC are
fixed and generally lower than comparable rates for other lines of credit.
Are there any fees or charges?
closing costs will apply which average approximately $1,800. However, these closing costs are most
often financed from the loan proceeds if necessary.
How is the SELOC different?
This credit line is
designed to respond to unplanned future needs. It will provide an
economical alternative to use of credit cards or more costly loans,
while still preserving much of your homes equity. The maximum
loan-to-value is approximately 35% at maturity. These loans may be
structured as an amortized, interest only, or capitalized loan (payments
of interest and principal deferred to maturity).
What happens at End of Term?
The loan can be paid off through
(1) sale of the property, (2) refinancing of the equity line or, (3) in certain
circumstances, may be converted to another form of equity conversion mortgage
(e.g. - Term or open-ended reverse mortgage).
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