Reverse mortgages (also called "home equity conversion loans") enable older homeowners to tap into built-up equity without having to sell their home. The lender gives you funds based on your home equity amount; you receive a lump sum, a payment each month or a line of credit. The borrowed money doesn't have to be paid back until the borrower sells his residence, moves away, or passes away. You or representative of your estate is required to pay back the reverse mortgage loan, interest accrued, and other finance fees after your house is sold, or you are no longer living in it.
Most reverse mortgages are available for borrowers who are at least 62 years of age, have a low or zero balance in a mortgage and maintain the house as your principal residence.
Many homeowners who live on a fixed income and find themselves needing additional money find reverse mortgages advantageous for their situation. Interest rates can be fixed or adjustable while the money is nontaxable and doesn't adversely affect Social Security or Medicare benefits. The lending institution will not take away your house if you outlive your loan nor will you be obligated to sell your home to pay off the loan even if the loan balance is determined to exceed property value. If you'd like to learn more about reverse mortgages, feel free to call us at 3039317879.