Reverse Mortgage Loan For The House Rich But Cash Poor

Reverse Mortgage Loan For The House Rich But Cash Poor

Reverse Mortgage Loan For the​ Houserich But Cashpoor
Do you​ need to​ finance a​ home improvement? Pay off a​ current mortgage? Supplement your retirement income? Take care of​ healthcare expenses? if​ so,​ a​ reverse mortgage lender will do wonders for you. With a​ reverse mortgage,​ you​ can turn the​ value of​ your home into cash without having to​ repay your loan each month.
When is​ it​ Repaid?
A reverse mortgage is​ a​ loan taken out against your home. the​ best thing about it​ is​ that you​ dont have to​ pay it​ back for as​ long as​ you​ live there. Reverse mortgage lenders only collect repayment when you
sell your home
or​ move to​ another house and live there permanently
What Types Are Available?
There are three basic types of​ reverse mortgages,​ and they are classified according to​ who the​ reverse mortgage lender is.
1. Singlepurpose reverse mortgage
This is​ offered by nonprofit organizations,​ state governments,​ and local agencies.
2. Federallyinsured reverse mortgage
This is​ also know as​ HECM,​ or​ Home Equity Conversion Mortgage. it​ is​ backed by the​ U. S Department of​ Housing and Urban Development,​ or​ HUD.
3. Proprietary reverse mortgage
The reverse mortgage lender of​ this type of​ mortgage is​ a​ private company.
Are There Other Differences Between Types?
The three types of​ reverse mortgages also differ in​ other aspects,​ particularly in​ their terms and manner of​ use.
1. Singlepurpose reverse mortgage
This has very low costs,​ and you​ can only qualify for one if​ you​ have a​ low to​ moderate income. There are two drawbacks to​ this type of​ reverse mortgage. First,​ it​ is​ not available everywhere. Second,​ it​ can only be used for the​ purpose specified by the​ government or​ by the​ reverse mortgage lender. Such a​ purpose may range from paying for home repairs to​ paying off property taxes.
2. HECM and proprietary reverse mortgage
These tend to​ be costlier than the​ other two home loans. in​ fact,​ the​ upfront charges could be very high. These two types of​ reverse mortgage,​ however,​ are not without their advantages. For one,​ many reverse mortgage lenders offer them. For another,​ HECM and proprietary reverse mortgage lenders do not ask for proof of​ income or​ a​ bill of​ good health. Finally,​ these two mortgages may be used for any purpose.
How Much Can you​ Borrow?
In singlepurpose reverse mortgage,​ the​ amount is​ set according to​ how much you​ need.
In a​ proprietary reverse mortgage or​ HECM,​ the​ reverse mortgage lenders offer amounts depending upon a​ combination of​ factors,​ such as
the​ type of​ reverse mortgage you​ choose
present interest rates
the​ appraised value of​ your home
your address
your age
Reverse mortgage lenders put a​ high premium on​ age. as​ a​ rule of​ thumb,​ the​ older you​ are,​ the​ more valuable your home is. Secondly,​ the​ less mortgage you​ have left to​ pay,​ the​ more money you​ can get.
How Will you​ Get What you​ Borrow?
A reverse mortgage lender gives you​ cash in​ several ways
1. all at​ once,​ in​ a​ single chunk of​ cash
2. as​ a​ credit line,​ wherein you​ can decide when and how much of​ the​ money available is​ paid to​ you
3. on​ a​ regular basis,​ with the​ amount and schedule of​ payment fixed
4. as​ a​ combination of​ the​ three previously mentioned payment methods
How Do you​ Qualify?
To be eligible for a​ reverse mortgage,​ you​ must be at​ least 62 years old and must live in​ your own house.
If you​ are cashstrapped,​ a​ reverse mortgage may just be the​ answer you​ need. Be sure to​ research about this type of​ loan first,​ though. in​ loans,​ as​ in​ all other things,​ it​ is​ better to​ be safe than sorry.

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