I'm applying for a reverse mortgage. When the lender calculates my rental income, do they add depreciation, mortgage insurance, taxes and insurance back into my net income?
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Best Expert Answer
Individual lender standards and procedures may vary. Factors that can affect whether rental income and related expenses may be calculated or how they are calculated include the length of time the borrower has been a landlord, the type of reverse mortgage you're applying for (FHA, conventional, etc) state law, and related factors. For FHA mortgages I did a review of HUD 4000.1 and couldn't find anything specific with regard to reverse mortgages and the items you mention-you may need to speak with your loan officer to get clarification on the procedure at that financial institution.
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