What Is the Service Fee Set-Aside?
Under the FHA HECM program, you are charged a monthly servicing fee that ranges from $25-$35 to manage your account once the loan closes.
The SFSA is an estimate of what the total servicing fees will be over the life of the loan, by multiplying your life expectancy (converted from years into months) multiplied by the $25, $30 or $35.
Although it's not considered a closing cost, the SFSA can equal several thousand dollars, which is deducted from your available loan proceeds.
You do not have access to that money, nor do you earn interest.
More Colorado Reverse Mortgage Loan Information:
About Colorado Reverse Mortgages! | Does My Home Qualify? | How Much Money Can I Get? | What are My Payment Plan Options? | Line of Credit Option is Earning Interest, Right? | How Can I Use the Proceeds from a Colorado Reverse Mortgage? | How Does the Interest Work on a Colorado Reverse Mortgage? | Are There Any Special Requirements to Get a Colorado Reverse Mortgage? | What If I Have An Existing Mortgage? | What Is the Service Fee Set-Aside? | Will I Lose My Government Assistance If I Get a Colorado Reverse Mortgage Loan? | Why Do I Need to Get Counseling? | When Do I Pay Back My Loan?