What Is A Reverse Mortgage And What Are Its Benefits

What is​ a​ Reverse Mortgage And What Are Its Benefits?
When it​ comes time to​ think about the​ future because you​ are getting older and closer to​ retirement,​ you​ may want to​ consider getting a​ reverse mortgage for your home .​
This is​ a​ rather new thing among mortgages,​ but it​ can provide you​ with a​ stable income until you​ no longer have need of​ the​ house .​
Here are some things you​ should know about a​ reverse mortgage .​
The idea of​ a​ reverse mortgage is​ to​ provide you​ with an​ income in​ your senior years when your income level may be lower or​ nearly non-existent .​
To start with,​ you​ must be at​ least 62 years old,​ and have some equity in​ your home .​
Other considerations of​ how much you​ can get include the​ value of​ the​ home and how much remains on​ the​ mortgage that is​ unpaid .​
What is​ It For?
The goal of​ getting a​ reverse mortgage is​ to​ tap into the​ equity of​ your home and use it​ to​ provide you​ with cash so that you​ can either meet upcoming expenses (possibly medical),​ or​ simply use it​ to​ maintain a​ certain level of​ living .​
Payments from the​ mortgage company to​ you​ can be obtained in​ a​ number of​ ways,​ including monthly payments as​ long as​ you​ live in​ the​ house,​ a​ lump sum,​ monthly payments over a​ term,​ payments plus a​ line of​ credit,​ and combinations of​ these things .​
Your options and amount you​ can receive are based on​ things like age and the​ amount of​ equity that you​ have in​ the​ house .​
The older you​ are the​ larger payment you​ will be eligible to​ receive .​
How Does It Work?
A reverse mortgage works differently than a​ regular mortgage .​
The first difference is​ that they pay you​ instead of​ you​ paying them .​
You make no payments until you,​ or​ those also named,​ no longer live in​ the​ house .​
At that time,​ however,​ the​ full amount becomes due,​ and generally will need to​ be sold in​ order to​ make the​ payment .​
Who Qualifies?
Another difference that applies to​ a​ reverse mortgage is​ that it​ does not matter how much you​ make in​ income at​ any time .​
Since you​ are not paying them - you​ can automatically qualify .​
There are,​ however,​ some things that remain the​ same as​ a​ regular mortgage - the​ fees and closing costs .​
When you​ no longer need the​ house,​ that is,​ either you​ move to​ a​ nursing home,​ or,​ at​ death,​ the​ house will be sold and you​ will pay back the​ principal and the​ interest .​
Any mortgages that exist on​ the​ house when you​ get a​ reverse mortgage will automatically be paid off at​ that time .​
Many people find that reverse mortgages can be rather confusing .​
This demands that you​ take a​ little extra time to​ learn about them well enough to​ know what is​ involved .​
Different lenders have different features,​ and you​ need to​ know that there are scams out there that deal with reverse mortgages .​
Compare each of​ them carefully .​
Most agencies,​ especially the​ Federal ones,​ will require counseling to​ help you​ understand all the​ options of​ a​ reverse mortgage before you​ apply.

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