Reverse Mortgage
A reverse mortgage is so aptly named due to "reverse" flow of payments compared to a traditional mortgage. This special type of mortgage affords homeowners over the age of 62 the opportunity to stay in their home and have access to the equity they have built in their property. Seniors can pull some of that equity out of their primary residence, which they can use however they choose.
Borrowers can choose from a line of credit, lump sum, monthly payments, or a combination of the three. This differs from a traditional mortgage used to puchase or refinance a home because a homeowner does not make monthly mortgage payments to the lender/bank. There is also mortgage insurance, which protects borrowers against a lender going bankrupt, for example, or protects the lender in case the borrower moves, sells the home, or passes away.
Single-family homes and qualified condominiums, townhouses, manufactured homes, and one-to four-family owner-occupied residences are eligible. Seniors interested in the program should expect to be stayng in their current home for several more years and not be concerned with giving their home debt-free to their children or heirs upon passing.
How The Reverse Mortgage Industry Can Make A Difference In The Lives of Seniors
The reverse mortgage:
- Ensures financial security for seniors
- Provides additional income
- Allows seniors to remain in their homes
- Offers money for investments
- Allows home improvements to meet seniors' changing lifestyles
- Helps alleviate the rising cost of healthcare
- Contributes to children's or grandchildren's education
- Relieves monetary obligations
- Affords a means for a dream vacation
- Ceases foreclosure
