Reverse Mortgage Explained


Reverse Mortgage Explained 1

Reverse Mortgage Explained
Reverse Mortgages are fast becoming all the​ rage here in​ the​ USA .​
As with everything else to​ do with your financial security,​ you​ should always exercise caution and seek as​ much information as​ you​ can from multiple sources.If a​ Reverse Mortgage appeals to​ you​ then you​ may find the​ following questions and answers useful.
What exactly is​ a​ reverse mortgage?
A reverse mortgage is​ specialized home loan that allows the​ home owner to​ exchange a​ bit of​ the​ equity in​ their house into hard cash .​
However unlike a​ conventional home equity loan or​ even a​ second mortgage for that matter,​ there are no repayments to​ make until the​ borrower stops using the​ home as​ their primary place of​ residence.
Do you​ qualify for a​ Reverse Mortgage?
In order to​ qualify for a​ reverse mortgage you​ must be at​ least 62 years old,​ living in​ the​ a​ home that you​ own,​ with no outstanding mortgage,​ or​ in​ some cases with a​ small amount of​ mortgage remaining that can be settled with the​ monies received from the​ reverse loan.
What type of​ properties are considered eligible?
Most types of​ property are eligible including .​
Units,​ detached houses,​ Town houses and various manufactured houses.
How does a​ reverse mortgage differ from second mortgages?
With conventional second mortgages,​ you​ must make monthly repayments and therefore you​ will be expected to​ have adequate income to​ meet such terms .​
However a​ reverse mortgage differs in​ so much as​ it​ pays you​ the​ money and does not require you​ to​ have any income.
Will the​ lender repossess my house if​ I​ live longer than the​ loan?
Absolutely not,​ you​ will not be required to​ repay any of​ the​ loan providing you​ continue to​ live in​ the​ home and that you​ continue to​ keep any current insurance and taxes on​ the​ home up to​ date.
What about my estate,​ will I​ have any to​ leave to​ my family?
Should you​ sell your house or​ if​ you​ no longer continue to​ use it​ for your main residence,​ then your estate will pay back to​ your lender the​ money you​ acquired from the​ reverse mortgage,​ in​ addition to​ any other fees and interest .​
All of​ the​ remaining equity in​ your house,​ will become the​ property of​ your inheritors.
How much can I​ expect to​ have from my house?
This will depend upon your age,​ current interest rates,​ and an​ appraised assessment of​ your property or​ the​ F.H.A .​
mortgage limits for your region,​ whichever is​ the​ smaller amount .​
by and large,​ the​ more expensive your house and the​ elder you​ are,​ the​ more you​ can lend.
What are methods of​ payment?
You have a​ choice of​ options on​ how you​ would like to​ receive your money from a​ reverse mortgage,​ you​ might want to​ have it​ as​ a​ line of​ credit,​ or​ from one of​ the​ following options;
1 All at​ once in​ a​ lump sum,​
2 Fixed monthly payments for a​ set period or​ for the​ duration of​ you​ stay in​ the​ house.
Usually the​ most popular option chosen by more than 55 per cent of​ borrowers is​ to​ take the​ line of​ credit,​ which will allow you​ to​ withdraw money on​ the​ loan proceeds at​ any given time.



Reverse Mortgage Explained



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