Reverse Mortgages
The Truth about Reverse Mortgages
Another alternative in borrowing
against your equity of your home is a Reverse Mortgage. To consider
this alternative you must be at the age of 62. Your home must be your
primary residence, such as a single family home, a town home, a
condominium, a duplex, triplex or a fourplex or in some cases a
manufactured home or a mobile home.
At least one homeowner lives in the home as their primary residence.
A
reverse Mortgage can be described as a special kind of mortgage loan
that can provide a retiree a safe and easy way to turn your home equity
into a lump sum of cash or if you choose a monthly income for the rest
of your life. This can raise your standard of living and enable you to
retain your home for the rest of your life.
This might be a
good time to consider this alternative, Today we have been seeing
historically high return on our homes and interest rates at a all time
low. With FHA loan limits it enables you to get more money out of your
home than ever before.
There are no credit requirements, no income requirements and no asset requirements to qualify for a reverse mortgage.
You
can use your money to pay off existing mortgage or credit card debt,
pay for in-home health care and other medical expenses, can provide
additional monthly income or buy something that you have always looked
forward to, or just take a vacation.
You will retain full
ownership and title to the property. If you leave the home and the loan
is repaid, then the home equity that has not been used will be given to
you and your heirs.
You will be required to pay off the loan
once you have moved out of the house permanently. A Reverse Mortgage
will not affect your right to Social Security payments or your Medicare
benefits. The money that you receive will be considered a loan and not
income, so you will not be paying income tax on the proceeds.
Depending
on the loan you qualify for there will be some costs such as an
origination fee, mortgage insurance fee and closing cost. They can be
financed as part of the initial loan advance.
Your heirs will not have to sell the home when you move out, but can refinance the home with a standard mortgage loan.
