Simply stating, a Reverse mortgage is a loan that enables homeowners (age 62 and older) to convert part of their equity in their home into a tax-free income without having to sell their homes, give up the title, or take on a new monthly mortgage payment. Many homeowners are using this to supplement their retirement income, pay for their health care, modify their home, or just get some cash for emergencies. Since it is a new product, some people might have misconceptions of what a reverse mortgage is? The bank doesn’t give you money and take away your house. Let’s look at some of the most common questions?
Is reverse mortgage for desperate people? The answer is No, because it is an excellent financial planning tool used from people by all walks of life.
How do I qualify? You must be atleast 62 or if both parties are on the mortgage, then you both must be at least 62. And, you must also have equity in your home.
What happens if I still owe on my home? You may still qualify even if you have a balance on your first mortgage. The proceeds must be used to pay off the mortgage, first.
How much can I get? This depends on several factors such as, the age of your home, the value, your age at the time of closing, and interest rates.
Is it just monthly payments? No. You can get a lump sum, line of credit, monthly payments or a combination of monthly income and a line of credit.
But, won’t I have to pay taxes on these monthly payments to the government? No. The funds are tax-free. Its your money, not additional income.
Should I seek a lawyer or receive some counseling before I get a reverse mortgage. Yes. You must be counseled before receiving a reverse mortgage. You don’t have to talk to a lawyer or accountant, but it would be advised.
Call 1-888-973-8377 to speak with a Reverse Mortgage Specialist
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