Is a Reverse Mortgage for You?
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With a reverse mortgage (also called a home equity conversion loan), homeowners of a certain age may use home equity for living expenses without having to sell their homes. The lender gives you funds based on your home equity amount; you get a one-time amount, a monthly payment or a line of credit. The loan doesn't have to be paid back until the homeowner sells his home, moves away, or passes away. You or representative of your estate is obligated to pay back the reverse mortgage amount, interest accrued, and finance fees at the time your home is sold, or you are no longer living in it.
Who is Able to Participate?
Usually, reverse mortgages require you be at least sixty-two years old, have a low or zero balance owed against the home and use the home as your main living place.
Reverse mortgages are advantageous for retired homeowners or those who are no longer bringing home a paycheck and must add to their fixed income. Social Security and Medicare benefits will not be affected; and the funds are not taxable. Reverse Mortgages can have adjustable or fixed rates. Your lending institution can't take away your residence if you live past the loan term nor can you be forced to sell your home to repay the loan even when the balance grows to exceed property value. If you would like to find out more about reverse mortgages, feel free to contact us at 713-676-5255.