1. Upfront Education – Harvard Home Mortgage representative pre-qualifies homeowner based upon age of youngest borrower and estimated home value. Harvard Home Mortgage loan officer explains available options such as monthly payments, cash and line-of-credit.

 2. Counseling - Homeowner seeks counseling from a local HUD-approved counseling agency, or a national counseling agency, such as AARP (800-209-8085), National Foundation for Credit Counseling (866-698-6322), or Money Management International (877-908-2227). Counseling is required for all reverse mortgages and may be conducted face-to-face or by telephone. Some states, such as North Carolina, require face-to-face counseling except in extreme circumstances.

 3. Application- Homeowner fills out a loan application and selects a payment plan, whether fixed monthly payments, lump sum payment, line of credit, or a combination of these. Harvard Home Mortgage loan officer will disclose to homeowner the estimated total cost of the loan, as required by the federal Truth in Lending Act. Homeowner provides loan officer with required information, including verification of Social Security number, copy of deed to home, information on any existing mortgage(s), and counseling certificate.

 4. Processing – Upon receipt of the signed counseling certificate, Harvard Home Mortgage orders an appraisal of your property to place a value on the home – generally the appraiser is paid directly by homeowner. The appraiser makes sure the physical condition of the property meets FHA guidelines. If defects are found, the homeowner must hire a contractor to complete the repairs or escrow sufficient funds at time of closing for the repairs.

 5. Underwriting - After receiving all pertinent information including the property appraisal, your application file is submitted to our in-house underwriting department for final approval. Generally, your file will be underwritten within 5 days of a completed file.

 6. Closing – Upon approval of your loan application we will schedule closing to be completed in your home. Closing documents and final calculations will be based upon the ‘expected rate’ effective at time of closing – generally this will be the lower of the rate at time of application or closing. Closing costs are normally financed as part of the loan.

 7. Disbursement - Homeowner has three business days after signing papers in which to cancel the loan. Upon expiration of this period, the loan funds are disbursed. Homeowner accesses the funds in the form of the payment option selected. Any existing debt on the home is paid off. A new lien is placed on the home to secure the reverse mortgage. The homeowner may use the loan proceeds for any purpose. The loan "servicer" manages the account and is responsible for disbursing monthly payments to the homeowner (if this option is chosen), advancing line of credit funds upon request, collecting any repayments on the line of credit, and sending periodic statements.

 8. Repayment - Homeowner doesn’t make any monthly mortgage payments during the life of the loan. The loan is repaid when the homeowner ceases to occupy the home as a principal residence. The loan may be repaid by the homeowner or the heirs/estate, with or without a sale of the home. The repayment obligation can’t exceed the home’s value or sales price.

 For additional understanding of the above procedure please see Terms