Reverse Mortgages for Seniors
Fannie Mae Homekeeper
In 1996, Fannie Mae developed
its own proprietary Home Keeper® reverse mortgage as a
conventional market alternative to the HECM. The Home Keeper
was developed to address unmet needs that could not be served
by the HECM program, such as individuals with higher property
values, condominium owners, and seniors wishing to use a
reverse mortgage to purchase a new home.
Fannie Mae is not a lender. With
Fannie Mae's permission, lenders can offer the Home Keeper
product to consumers, like yourself.
The Home Keeper is available in
every state to homeowners 62 years of age and older. Eligible
property types include owner-occupied single-family homes,
condominium units, and units in qualified planned unit
developments. Properties held in trust and qualified leasehold
properties are also eligible. Cooperative units, however, are
not an eligible property type for Home Keeper.
The amount of funds available to
the borrower is determined by a formula and varies with: (1)
the age and number of borrowers at the time of application;
(2) the adjusted value of the home; and (3) current interest
rates. Home Keeper loans can be larger than HECMs because
Fannie Mae’s maximum mortgage limit.
A consumer may choose to receive
the funds from a Home Keeper as: (1) fixed monthly payments
for life (i.e., for as long as the borrower occupies the home
as his/her principal residence; (2) a line of credit; or (3) a
combination of monthly payments and line of credit. Home
Keeper borrowers are charged an origination fee that may not
exceed 2 percent of the adjusted value of the home, whichever
is greater, a monthly servicing fee ($15-$30), and other
closing costs. Many of these can be financed and included in
The interest rate charged on a
Home Keeper reverse mortgage adjusts monthly and is equal to a
fixed spread above an index rate – the current weekly average
of the one-month secondary market CD rate, which is published
by the Federal Reserve. The rate may never rise by more than
12 percentage points above the initial rate; there is no cap
on a monthly adjustment other than the lifetime cap.
One interesting feature of the
Home Keeper is that you can use the program to purchase a new
home – all in a single transaction. The transaction reduces
the out-of-pocket cash needed to buy a new home, eliminates
any new monthly mortgage payment, and helps you keep more of
the sales proceeds from the old house – or a larger amount of
savings – to use for other purposes.
This product might be used, for
instance, by older homeowners who want to sell their old home
and move closer to their children or to a warmer climate, or
to move into a home that provides greater accessibility.
Home Keeper is a registered
trademark of Fannie Mae
Apply for your Reverse Mortgage Apply
Now via the internet