Reverse Mortgages Funding Retirement

Reverse Mortgages – Funding Retirement
With people living longer and longer,​ funding retirement can become a​ stressful situation .​
Reverse mortgages can help home owners avoid worries about cash flow .​
Reverse Mortgages
Reverse mortgages are essentially a​ method for turning the​ equity in​ your home into cash .​
Although there are various options,​ a​ typical reverse mortgage will provide you​ with a​ lump sum,​ monthly payments or​ a​ credit line based on​ the​ equity in​ your home .​
The mortgage will have a​ term of​ a​ certain number of​ years .​
Instead of​ making payments on​ the​ loan,​ the​ bank will become the​ owner of​ the​ percentage of​ your equity applied for the​ loan at​ the​ end of​ the​ term .​
Reverse mortgages are only available to​ older applicants .​
Every person listed on​ the​ deed of​ the​ home must be 62 years of​ age or​ older .​
You must also use the​ home as​ your primary residence .​
The decision to​ pursue a​ reverse mortgage can be a​ tricky one .​
The biggest issue is​ an​ emotional one .​
We are all mentally trained to​ buy a​ home and try to​ build equity over the​ years .​
With a​ reverse mortgage,​ we are making the​ mental leap to​ actually reduce the​ equity in​ our homes .​
While this may sound like a​ sensible method for using the​ nest egg equity,​ it​ makes you,​ me and everyone very nervous .​
For some seniors,​ the​ reverse mortgage decision makes sense while it​ doesn’t for others .​
To limit the​ potential for problems and scams,​ banks are required to​ have senior applicants meet with unbiased third parties to​ determine the​ benefits and downside of​ using reverse mortgages .​
If you​ or​ your parents have reached retirement age and are facing cash flow problems,​ you​ need to​ become flexible in​ dealing with finances .​
Reverse mortgages may be one flexible option that makes sense for your particular situation .​
After all,​ you​ can’t take the​ equity in​ a​ home with you.

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