senior couple in kitchen

1. What is a Reverse Mortgage or Home Equity Conversion Mortgage (HECM)?

A Home Equity Conversion Mortgage (HECM) is commonly known as a Reverse Mortgage. HECM is a home-secured loan designed to help homeowners 62 years of age or older turn some of their home equity into cash. You may choose to receive monthly payments, a lump sum of cash, or a line of credit. HECM is insured by the Federal Housing Administration (FHA) and offers all the benefits of a traditional line of credit that you can get from a bank but with additional benefits— including a flexible repayment feature. As with any mortgage, you must meet your loan obligations, keep current with property taxes, insurance, maintenance, and any homeowner’s association (HOA) fees.

2. How much money can I get?

The specific amount of funds available is based on several factors, including the appraised value of your home, your age, current interest rates, and Federal Housing Administration (FHA) lending limits.

3. How do I receive my proceeds from the Reverse Mortgage?

Proceeds from the Reverse Mortgage are tax-free* and can be distributed in a variety of ways based on your choice. Proceeds from the Reverse Mortgage may be taken as:

  • A lump sum
  • A Line of Credit
  • Monthly payments for a specified time period
  • Monthly payments for as long as you live in the home
  • Or a combination of these

4. What are the costs associated with a Reverse Mortgage?

In addition to interest, the costs include a title fee, credit report fee, appraisal fee, origination fee, closing costs, mortgage insurance premium, and a modest charge for the Reverse Mortgage counseling. Consult with a Housing and Urban Development (HUD)-approved reverse mortgage counselor before you apply. A counselor can help you decide whether a reverse mortgage or some alternative is the best choice for you. To find a HUD-approved Home Equity Conversion Mortgage (HECM) counselor near you, call (800) 569-4287.

While closing costs vary based upon the size of the loan, they’re the same as those for any traditional mortgage. You can roll most of the up-front costs into the loan, so out-of-pocket expense can be minimized.

* Wheelhouse Credit Union cannot provide tax advice. Please consult a tax advisor.

© 2024 Wheelhouse Credit Union. Federally insured by NCUA. Equal Housing Opportunity Lender.

Full length shot of beautiful, happy young woman sitting on the cozy sofa with hands behind head, looking away, smiling and daydreaming.

The prevalence of self-care messaging reminds us to nurture our physical and mental well-being—with mindfulness practices, exercise routines, and virtual detoxing. But what about financial self-care?

When we cultivate positive money habits and plan for our future we are (quite literally) investing in ourselves. Financial self-care is rooted in self-awareness, discipline, and intentionality. Here are several ways you can practice financial self-care, starting now.

Build a Budget
Building a budget is akin to giving yourself the gift of clarity: it allows you to track expenses, identify potential areas where you can trim spending, and allocate funds to help you achieve financial goals. Rather than seeing budgeting as a restrictive practice, frame it as a tool that grants you freedom to spend where it matters. Connect with your financial institution to see what budgeting tools they offer and check out this interactive budgeting worksheet in the meantime.

Create an Emergency Fund
More than half of Americans fear they wouldn’t be able to cover daily living expenses for a month if they lost their income tomorrow, according to a recent Bankrate survey. Invest in your future peace of mind: set up an automatic, recurring savings deposit with the goal of setting three to six months’ worth of living expenses aside. If you’re living paycheck to paycheck, you can start small by setting aside 2% of your net income and gradually increasing your contribution rate when possible.

Tackle Debt
With recent federal interest rate hikes, borrowing costs have reached historic highs which means even your debt is costing you more money. If you’re feeling overwhelmed, you’re not alone. Taking proactive steps towards debt reduction can improve your financial health and significantly reduce your stress. Unsure where to begin? Explore a Debt Management Program, designed to pay off your debt in 3-5 years and deepen your financial resilience.

Plan for Retirement
If your employer offers a 401(k)-retirement plan, take advantage of this benefit (especially if your company matches part or all of your contribution). Don’t have a workplace retirement account? You can still open a Roth IRA—a tax-advantaged retirement savings account. If you find it challenging to save throughout the year, consider setting aside part or all of your tax refund as a way to begin investing without impacting your day-to-day budget.

Get Educated
One of the most empowering aspects of financial self-care is education. Chat with your financial institution about what resources they offer. If you want to explore courses and are worried about costs, take advantage of free financial education online. Whether you’re preparing to buy a home or navigating your auto loan, these sessions offer jargon-free, shame-free guidance to help you reach your financial goals.

This article is shared by our partners at GreenPath Financial Wellness, a trusted national non-profit.

Piggy bank floating in the ocean on a life preserver

An economic recession is something that is out of our control. However, we can control how we plan, prepare, and respond. When the worst happens, the following money-saving tips will be lifesaving to have in your back pocket.

1. Maintain a Savings Account for Emergencies
If you haven’t already, now is the time to start saving for a rainy day. Having a backup emergency fund set aside solely for the purpose of helping you get through a financial hardship will be tremendously helpful in the event of an economic recession. If possible, it’s recommended that you have 3 to 6 months’ worth of wages saved up, so that a large, unexpected expense doesn’t result in running up your credit balances without the means to pay it off.

2. Pay Off Your Debts with a Budget
Debt can feel like carrying a heavy burden on your back. That weight will only be intensified in the event of a recession, being that the uncertainty of external factors (like job security and interest rate spikes) could make it harder to pay down your debt. The first step you should take to become debt-free is to establish an accurate budget that will help you manage incoming and outgoing resources.

3. Downsize
If you can feel a recession approaching in the imminent future, it might be time to start thinking about living a more frugal lifestyle (which might not be as difficult as it sounds). Downsizing can be an extremely advantageous strategy, because if you can learn to make do with less now, you’ll increase your savings and start preparing for a time when you’ll need to cut back.

4. Diversify Your Income
The phrase, “Don’t put all your eggs in one basket” rings true in the event of an economic recession. Uncertainty is high, and it’s better to be safe than sorry. It might be a good idea to investigate additional forms of income (bonus points if they involve activities you enjoy!) Try dog-walking, babysitting, or perhaps think about selling the empty furniture set that’s collecting dust in your spare bedroom. Whatever it may be, having a second or even third income flow will only give you more security when everything else in life isn’t guaranteed.

It’s never too late to start planning and preparing for an economic downturn – you’ll be thanking yourself in the long run. If you need further assistance or advice, visit our Retirement and Investment Resource Center to schedule a no-obligation meeting with our experienced Financial Professional, Wendy Cundari.*

*Wendy Cundari is a registered representative with, and securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Wheelhouse Credit Union and Wheelhouse Investment Services are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Wheelhouse Investment Services, and may also be employees of Wheelhouse Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Wheelhouse Credit Union or Wheelhouse Investment Services.

Securities and insurance products offered through LPL or its affiliates are:
Not Insured by NCUA or Any Government Agency
Not Credit Union Guaranteed
Not Credit Union Deposits or Obligations
May Lose Value

The LPL Financial registered representatives associated with this website may discuss and/or transact business only with residents of the states in which they are properly registered or licensed. No offers may be made or accepted from any resident of any other state.

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