Thomas Martin – Mortgage Loan Originator– 954-667-9110 – Rev. 3-13-2025 – Subject to change without notice. 

Florida Reverse Mortgage On A Condo?

Interested in a reverse mortgage for your Florida condo? Reverse mortgages on Florida condos have become a popular financial tool for 55+ people looking to tap into their home equity without selling their homes. Florida condo owners have been neglected when it comes to cashout options on their condos. Its aging retiree population and increasing condo costs present a unique opportunity for 55+ Florida condo owners to cash out they desperately need. The Reverse Florida Condo Lenders open up possibilities to borrowers whose needs, or qualifications, don’t quite fit the standard reverse mortgage mold. Let’s take a closer look at the back.

REVERSE MORTGAGE FLORIDA CONDO REQUIREMENTS

• Minimum age: 55+
• Live in the home as a primary residence
• Complete a financial assessment and counseling
• Minimum credit score 600
• FHA or FNMA condo approval is preferred.
• Condos may be approved.

KEY FEATURES 

• Minimum age 55+
• Loan amounts up to $4M
• Larger limits don’t have to mean larger loans
• No monthly mortgage payment is required
• No MIP
• All available funds are distributed at close
• Can use funds to pay off debt to qualify
• Can use loan proceeds (as income) to qualify
• Non-recourse loan

Reverse Florida Condo Lenders – Use FNMA Guidelines

• There’s no minimum value or loan amount and we lend up to 4,000,000
• On Refi’s NO Income docs are needed for a qualifying credit score 780 or above, we can waive Residual income requirements (need insurance in place for 12 months) and satisfy credit history
• Borrowers with lower value/loan amounts can benefit from this product as well if they would like max cash at closing
• For Condos that are not FHA-approved, FNMA-approved or Warrantable projects (we need the Reverse Florida Condo Lenders Questionnaire completed by HOA, Master Policy and insurance for a limited review)
• Borrowers that do not have enough income/assets to meet the Residual Income Requirements Or if they don’t have ANY income but have a huge Reverse proceed, we can solely use to qualify and can paid off debt at Closing
• Fast Underwriting turn time (average 3 weeks from Submission to Clear to Close)

Florida Reverse Mortgage Condo General Program Parameters

• Loan Terms Fixed-rate, single disbursement, lump sum
• Draw Amounts No minimum or maximum up to loan amount
• Eligible States All licensed states except:
• Prop Not Allowed in Following States: IA, MD, TN, WI

Use of Proceeds Purchase or Refinance

• Borrower Counseling Reverse Mortgage counseling required
• Servicing Fee None

Borrower Eligibility

• Eligible Borrowers • US citizens,
• Permanent resident aliens,
• Inter Vivos Revocable Trust,
• Non-Permanent Resident Aliens (with conditions)

Ineligible Borrowers

• Foreign nationals
• Limited partnerships, general partnerships, corporations
• Non-occupant co-borrowers,
• Non-borrowing spouse
• Other Non-borrowing persons
• Irrevocable Trusts

Property Eligibility

• All outstanding existing Florida condo mortgages and liens on the subject property must be paid off through the settlement of the reverse mortgage.
• No subordinate financing permitted

Seasoning Requirement

• The existing reverse mortgage being refinanced must have closed and disbursed a minimum of twelve (12) months before the Reverse Florida Condo Lenders disbursement date.

Property Values

• Minimum Value – None (Properties <$400k require 2% origination fee)
• Maximum Value – None

Eligible Property Types

• Single family residence
• Owner-Occupied 2-4 units
• Townhomes
• PUD
• Condominium FHA and FNMA Approved or FNMA-warrantable projects under a Limited Review process.

Occupancy

• Primary Residence
• Occupied by the borrower(s) for the majority of the year (183 days) Address of record is for such activities as income tax reporting, voter registration, and similar functions Repairs
• Repair set-asides are not permitted
• Any noted repairs that may impact the structural integrity of the subject property and/or the health and safety of the occupant(s) must be completed satisfactorily prior to closing.

Appraisal Requirements

• Appraiser must be state-registered. FHA-approved appraisers are strongly recommended.
• One (1) appraisal with UPB up to $1,000,000 plus independent CDA or equivalent Desk Review.
• Two (2) Appraisals with UPB $1,000,000 or greater. A lower of two will be used. CDA or equivalent Desk Review required on appraisal being used.
• Appraisal is valid for 120 days
• Appraisals must be completed in compliance with FIRREA/USPAP requirements
• Declining Market – 5% PLF Reduction

Minimum Loan Amount

• None / Maximum Loan Amount
• Maximum Loan Amount: $4,000,000 (higher amount may be considered on an exception basis)

Credit Requirements

• Credit Report • Tri Merge credit report for all borrowers
• Minimum Mid Credit Score
• 600 – additional credit requirements 600-640

Credit History Mortgage History

• 0x30 in last 12 months
• 2×30, 0x60 in last 24 months

Credit Requirments Bankruptcy/Foreclosure:

• Chapter 7 – Must be discharged (3) years from loan application date.
• Chapter 13 – Must be discharged (3) years from loan application date.
• Chapter 11 – Must be discharged (3) years from loan application date.
• Foreclosure – None in past three (3) years.

HOA/Property Tax:

• Must be current with no arrearages
• 1×30, 0x60 in last 24 months

FINANCIAL ASSESSMENT- CREDIT HISTORY

The Lender must evaluate borrower(s) willingness and capacity to meet their financial obligations
and to comply with the mortgage requirements.

CREDIT SCORE

• The minimum qualifying credit score is 600 for all borrowers.
• For minimum qualifying credit scores between 600-640, additional credit requirements apply.
• The qualifying credit score is determined by taking the middle score from all three (3)
repositories reporting. For this example, the score used to qualify is 720.

CREDIT/PROPERTY CHARGE REVIEW

Includes review of public records concerning property, mortgages, property tax payments and
property charges (HOA/Condo/PUD fees, ground rent and other assessments)

STATE/FEDERAL TAX LIENS

Any open state or federal tax lien appearing on the credit report must be satisfied.
• Evidence of payment in full, if paid prior to settlement; or
• Payoff statement, if paid at settlement

BANKRUPTCY

Chapter 7,11,13: Must be discharged (3) years from loan application date.

MORTGAGE HISTORY

Mortgage history, on the subject property (if applicable), must reflect the following, if applicable:
• 0x30 in the last 12 months
• 2×30, 0x60 in the last 24 months

FORECLOSURE/LOSS MITIGATION

No foreclosures on any property, in past three (3) years of loan application date.
Borrowers with any history of the following are not eligible unless there is at least a minimum of
two (2) years re-established credit history:
• Multiple bankruptcies -two (2) or more
• Loan modification
• Short sale
• Deed-in lieu of foreclosure

QUALIFYING CREDIT SCORE BELOW 640

600+ Minimum credit score When the qualifying credit score is below 640, the following additional criteria apply:
• No major derogatory credit within the previous 12 months of the credit report.
• All accounts reporting on the credit report must be current. For the purpose of this section, Major Derogatory credit shall include:
• Any payments on Revolving or Installment Debt that are 90 days or more after the due date (1×90), or three or more payments 60 days or more after the due date (3×60).
• Non-medical collections or charge-offs in excess of $2,000 within the past 24 months.

PROPERTY TAXES

All property charges must be current and there are no property tax arrearages. In addition, no more than:
• 1×30 in the last 24 months

GENERAL INCOME REQUIREMENTS

Effective Income refers to income that may be used in the calculation of residual income. Effective income must be reasonably likely to continue through at least the first three years of the mortgage. The lender must document the borrower’s income and employment history, verify the accuracy of the amounts of income being reported, and determine if the income can be considered as effective income in accordance with the requirements listed below. The lender is only required to verify the amount of income needed to qualify under the Residual Income Test. The lender may only consider income if it is legally derived and, when required, properly reported as income on the borrower’s tax returns. Negative income must be subtracted from the borrower’s gross monthly income and not treated as a recurring monthly liability unless otherwise noted.

TRADITIONAL CURRENT EMPLOYMENT DOCUMENTATION

The lender must obtain the most recent paystubs covering a minimum of 30 consecutive days that show the borrower’s year-to-date earnings, and one of the following to verify current employment:
• A written Verification of Employment (VOE) covering two (2) years; or
• An electronic verification covering the same period.
Re-verification of employment must be completed within ten (10) days prior to mortgage disbursement. Verbal re-verification of employment is acceptable.

ELIGIBLE BORROWER TYPES

US Citizen
• Permanent Resident Alien: A permanent resident alien is a person who is not a United States citizen but is legally able to maintain permanent residency and employment in the United States. A permanent resident alien may be eligible as a borrower if the borrower is a holder of an alien registration card (green card) with a valid Social Security Number.
• Non-Permanent Resident Alien: A non-citizen who holds employment in the United States but does not have a green card.
• A borrower who is a non-permanent resident alien may be eligible provided: o the borrower has a valid Social Security Number (SSN), except for those employed by the World Bank, a foreign embassy, or equivalent employer identified by HUD. The borrower is eligible to work in the U.S., as evidenced by the Employment Authorization Document issued by the USCIS; and o the borrower satisfies the same requirements, terms and conditions as those for U.S. citizens.

A borrower residing in the U.S. by virtue of refugee or asylum status granted by the USCIS is automatically eligible to work in this country. The Employment Authorization Document is not required, but documentation substantiating the refugee or asylum status must be obtained. Non- U.S. citizens without lawful residency in the U.S. are not eligible. Inter Vivos Revocable Trust: An inter vivos revocable trust that has an ownership interest in the security property is an eligible borrower.

INELIGIBLE BORROWER TYPES

Foreign National: A foreign national is a person who is not a United States citizen and who lives and works outside the United States. Limited Partnership, General Partnership, Corporation, or the like: Business entities that
are separate and distinct from individual ownership. Non-Occupant Co-Borrower: A non-occupant co-borrower is an individual who will not be living in the subject property, but whose profile has been used to qualify for the loan. Although the co-borrower does not occupy the subject property, s/he is jointly responsible (with the primary borrower) for repaying the loan. Non-Borrower Spouse: The NBS is defined as the spouse of the reverse mortgage borrower determined by the law of the state in which the spouse and borrower reside or the state of which they were married.  Other Non-Borrower Persons: All individuals vested on Final Title must be a borrower on the loan. Irrevocable Trust: An irrevocable trust cannot be changed or canceled once it is set up without
the consent of the beneficiary. Contributions cannot be taken out of the trust by the grantor.

IDENTIFICATION REQUIREMENTS

In compliance with Section 326 of the USA PATRIOT Act which requires U.S. financial institutions to verify the identity of a customer when opening an account, lender/originator must obtain
identifying documentation from each borrower. The lender/originator must also verify the borrower(s) date of birth and Social Security Number.
Acceptable identification (ID), as follows:
• State-issued driver’s license
• State-issued ID card
• Military ID card
• Passport
• U.S. Alien Registration Card
• Birth Certificate
• Written verification from the Social Security Administration Evidence of Social Security
Number
• Social Security card (plastic or metal cards are not acceptable)
• Social Security 1099
• Form W2 or 1098
• Written verification from the Social Security Administration

ALTERNATE CONTACT

Contact information for the borrower’s alternate contact/nearest living relative must be obtained, as follows:
• First name and last name
• Address
• Phone number (cannot be the same as the borrower’s phone number)
• Relationship to Borrower(s)

MULTIPLE LOANS FOR THE SAME BORROWER

A borrower may only have one outstanding reverse mortgage at any time, whether it is an FHA-insured Home Equity Conversion Mortgage (HECM) or a proprietary reverse mortgage.

OWNERSHIP INTERESTS

Title must be in the borrower’s name:
• At the time of application for a refinance transaction, and
• At the time of closing for all transactions.

Exceptions:

• The title is vested in the name of a business or corporation whereby the borrower has full
ownership. Must be in borrower(s) name at closing.
• The borrower is a beneficiary from an estate or trust vested on title. Must be in borrower(s)
name at closing.
• The borrower is the spouse of the current vested owner. Must be in borrower(s) name at closing.

OCCUPIED PRIMARY RESIDENCE

• A primary residence is defined as a borrower spending at least 183 days of the calendar year at the subject property.
• Non-owner occupied, and investment properties are not permitted.

BENEFIT TO BORROWER TEST

All reverse mortgage refinances must provide a clear benefit to the borrower(s). To confirm a benefit, the loan must pass BOTH the Closing Cost Test and the Loan Proceeds Test.

OFFICE OF FOREIGN ASSETS CONTROL (OFAC)

• An OFAC report is required for all borrowers.
• If a party to the loan is found to be on the OFAC list, the loan is ineligible under this program.

LOAN PROCEEDS TEST

In order to pass the Loan Proceeds Test the Available Benefit Amount from the new CHOICE loan, defined as the amount of proceeds (Principal Limit) that is available to the borrower after deducting the prior refinanced loan balance AND the closing costs paid by the borrower(s) on the CHOICE loan, must equal or exceed 5% of the refinanced Principal Limit amount.

ALTERNATIVES TO THE BENEFITS TEST

On a case-by-case basis, at the written request of the borrower(s), an exception to the above Benefits Test may be granted only if a clear benefit can be demonstrated. All exceptions to the benefits test above must be reviewed and approved by the Lender.

The written request must state the following:
• Their benefit is less than five (5) times the amount of their closing costs and/or their
available loan proceeds do not increase by at least 5%.
• Indicate they still wish to move forward with the loan.
• Demonstrate a benefit to the borrower(s) by proceeding with the transaction.
Examples of Acceptable Benefits are below (must receive approval):
• Adding an eligible spouse to the loan;
• Reducing the interest rate by a minimum of 1% from previous transaction (proceeds cannot decrease and the borrower cannot bring funds to close).
• Receiving in excess of $20,000 in net proceeds needed by the borrower(s) for current financial
hardship.
• Other Benefits to the borrower as demonstrated in the written request.

SEASONING REQUIREMENTS

The existing reverse mortgage being refinanced must have closed and disbursed a minimum of twelve (12) months prior to the CHOICE disbursement date. On a case-by-case basis, at written request of the borrower(s), an exception to the seasoning requirements may be granted only if a clear benefit can be demonstrated. All exceptions to the seasoning requirements must be reviewed and approved by the Lender. The written request must state the following:
• Acknowledge 12 months have not elapsed since the previous reverse mortgage closed and disbursed.
• Indicate they still wish to move forward with the loan.
• Demonstrate a benefit to the borrower(s) by proceeding with the transaction.

REVERSE MORTGAGE COUNSELING

Independent reverse mortgage counseling is required for all borrowers with a vested interest at closing. Power of Attorney or Guardian/Conservator must be counseled on behalf of any borrower(s) or vested owner(s) that are legally incompetent. The lender must not accept a final and completed application or assess any fees on the borrower/applicant without first receiving a copy of the completed counseling certificate signed by the counselor and borrower.

COUNSELING FEE

• Counseling agencies may charge a fee for reverse mortgage counseling.
• The counseling fee must be paid up front by the applicant(s) and cannot be financed
into the loan.
• Lender/originator cannot pay counseling agencies directly or indirectly for reverse
mortgage counseling services through either a lump-sum payment or on a case-by
case basis.

FLORIDA CONDO REVERSE COUNSELING

The following counseling agencies are permitted to perform counseling for any borrower seeking the 55+ Reverse Florida Mortgage program:

Cambridge Credit Counseling 888-764-7460
Consolidated Credit Solutions 800-728-3632
Debt Helper 800-920-2262
GreenPath Debt Solutions 877-385-1941
Money Management International 866-834-0428
National Foundation of Debt Management 888-738-8233
Project Sentinel 888-339-6043
QuickCert 888-383-8885
Spring Board/Credit.org 800-294-3896
Horizon Counseling Inc. 888-315-4326

COUNSELING CERTIFICATE

Upon completion of the counseling session(s), the counseling agency issues a counseling certificate, as follows:
The certificate must contain each of the following:
• Borrower(s) Name(s), Power of Attorney, Guardian/Conservator, as applicable
• Subject property address
• Name of the counselor
• Name of the counseling agency
• Employer Identification Number (EIN) of the agency
• Date counseling completed
• Manner in which counseling was completed (face-to-face/ telephonic)
• Certificate expiration date
The certificate must be signed and dated by all applicants and/or their representatives.

APPLICATION

This section includes information concerning certain documents contained in the application package.

GENERAL REQUIREMENTS

• All documents must be signed and dated by the appropriate parties.
• Initial disclosures must be sent at or within three (3) days of application. Documents containing a specific interest rate(s), such as the Comparison of Products, must reflect the rate(s) in effect on the date of disclosure.
• The MLO signs both the initial Loan Application and final Loan Application.
• All state disclosure requirements must be adhered to.

INITIAL APPLICATION

An initial application may only be taken by a licensed Mortgage loan Originator (MLO) who holds an active license in NMLS for the state the property is located, or are sponsored by a federally  chartered institution in the subject property state. The MLO consults with the borrower to explain program options, discuss eligibility, provide a Counseling Referral List, and collect the necessary information to produce the initial application package to submit to the borrower.

DEFINITION OF APPLICATION

For purposes of initial disclosure requirements, the file is considered an application when the following data is obtained and an intent to proceed is given:
• Borrower and co-borrower Name, as applicable
• Borrower’s monthly income (all borrowers)
• Borrower’s Social Security Number (all borrowers)
• Borrower’s Date of Birth (all borrowers)
• Property address
• Estimate of the value of the property
• Interest Rate
• Product Type/Margin
• Principal Limit
The application may be in writing or electronically submitted, including a written record of an oral application (e.g., via telephone).

DEFINITION OF COMPLETED APPLICATION

For Reg B purposes, the application is considered a “completed application” upon receipt of all
information needed to provide a decision on the loan. Smartfi defines this date when the following
items have been received:
• Fully executed and completed written application package
• Fully executed counseling certificate
• Identification documents including verification of DOB, SSN
• Credit Report
• Income/expense documentation
• Asset documentation
• Power of Attorney/Guardianship paperwork (if applicable)

SERVING ALL FLORIDA