answersLogoWhite

0


Best Answer

A reverse mortage is used by people over 62. They can take part of the equity In their home and turn it into cash.

"Basically, a reverse mortgage is a way for seniors to turn their home equity into a cash loan. The money is distributed either via one lump sum or through payments. The owner's repayment is deferred until the owners death."

AARP.com/reverse has a lengthy article on what a reverse mortgage is.

HUD endorsed loan where the over 62 homeowner can gain access to a portion of their equity in the form of cash. The older a person and the more valuable a home determines the amount of cash they have access to. Once in place, the reverse mortgage can either pay the borrower monthly or create an open line of credit that the borrower can use for any purpose. Any money used will accrue interest and will eventually have to be paid back after the person sells the home or passes away. If a person has a current regular or forward mortgage they should have at least 50% equity to qualify for a revers

User Avatar

Wiki User

โˆ™ 2008-09-30 21:54:45
This answer is:
๐Ÿ™
0
๐Ÿคจ
0
๐Ÿ˜ฎ
0
User Avatar
More answers
User Avatar

Wiki User

โˆ™ 2014-12-01 00:00:22

The Home Equity Conversion Mortgage (HECM) is FHA's reverse mortgage program which enables you to withdraw some of the equity in your home. The HECM is a safe plan that can give older Americans greater financial security. Many seniors use it to supplement social security, meet unexpected medical expenses, make home improvements and more. You can receive additional free information about reverse mortgages in general by contacting the National Council on Aging at (800) 510-0301 or downloading their free booklet, "Use Your Home to Stay at Home," a guide for older homeowners who need help now. It's smart to know more about reverse mortgages, and decide if one is right for you!

User Avatar

User Avatar

Wiki User

โˆ™ 2013-12-16 00:00:25

Reverse mortgage allows you to get money equal to your equity to use. You do not have to pay it back and you can't lose your home over it. The bank will get their money back when your home is sold or when you die and your estate is settled.

User Avatar

Add your answer:

Earn +20 pts
Q: How does a reverse mortgage work?
Write your answer...
Submit
Related questions

Do you still have to pay monthly mortgage if you have a reverse mortgage?

No, the purpose of a reverse mortgage mortgage is to eliminate mortgage payments permanently.


What is a reverse mortgage lead?

A reverse mortgage lead is where you can get names of people that are interested in getting a reverse mortgage. These leads should already have been screened to meet the criteria for a reverse mortgage.


Do reverse mortgage calculators work accurately?

A reverse mortgage calculator is only as accurate as the information that is imputed by the user. Consider it as an educated guess or a ball park estimate.


What does a reverse mortgage adviser do?

A reverse mortgage adviser usually tells people how much their homes are worth. Sometimes they work for financing companies or banks, and do estimates on homes.


Can you qualify for a Reverse mortgage with balance owed on original mortgage?

Yes. The reverse mortgage must however pay off the existing mortgage balance, which means you need some equity to make the qualification work. If there is not enough equity in the home to qualify for a reverse mortgage you may choose to bring in the amount needed to finish paying off the existing mortgage- thus eliminating the mortgage payments for good.


What are the reverse mortgage scams taking place today?

Yes, there are reverse mortgage scams, as well as regular mortgage scams. You need to be careful who does your reverse mortgage, so you do not get scammed


What is reverse equity mortgage?

a reverse equity mortgage usually refers to a reverse mortgage, also referred to as a HECM loan. (Home Equity Conversion Loan). The key difference between a regular mortgage and a reverse mortgage is that no monthly mortgage payments are due on a reverse mortgage. A reverse mortgage also does not have credit or income requirements because there are no payments due. Qualification is based on age- minimum age 62- the value of the home and its location.


What is new reverse mortgage and where can I learn about it?

You can not get a reverse mortgage if you already have a reverse mortgage in exsistence. If you do not have one you can go to a few places for help such as; rvmortgage.com and allrmc.com


What is American reverse mortgage?

American reverse mortgage is when you borrow money based on the value of your house. A reverse mortgage has the option of being a lump sum or installments.


Where can you find a reverse mortgage calculator?

Reverse mortgage calculators can be found on line on most mortgage websites.There are hundreds of mortgage loan sites.& This calculator makes it easier to understand the reverse mortgage math and to let you see if this type of mortgage is best for you.


Can you have a reverse mortgage on a condo?

The lender who will qualify you for a reverse mortgage can help you answer this question: there is no standard.


Where can I learn about liberty reverse mortgage?

You can learn about liberty reverse mortgage from any local tax consultant or by finding it on a website which deals specifically with liberty reverse mortgage.


Where can one get reverse mortgage quotes?

There are many places where one can get reverse mortgage quotes. One can get reverse mortgage quotes at popular on the web sources such as ARRP and Bank Rate.


Can you get a reverse mortgage if you file bankruptcy?

Yes, a reverse mortgage does not have any credit requirements, however if you are in bankruptcy or filing one you may need court approval to do the reverse mortgage.


What do you do with marketing and reverse mortgage?

There isn't any marketing that you need to do for an reverse mortgage. All you have to do is visit a local realator and you can also go online and search under reverse mortgage.


Can you re-finance your reverse mortgage?

yes, you can refinance it to a regular mortgage, or if interest rates are lower you can streamline it to a new reverse mortgage.


What happens to the land in a reverse mortgage contract?

In a reverse mortgage arrangement the lender ends up with the property unless someone pays off the mortgage.In a reverse mortgage arrangement the lender ends up with the property unless someone pays off the mortgage.In a reverse mortgage arrangement the lender ends up with the property unless someone pays off the mortgage.In a reverse mortgage arrangement the lender ends up with the property unless someone pays off the mortgage.


Where can one find reverse mortgage rules?

Reverse mortgage rules can be found at your local bank and at Consumer Information, Home Guides, Investopedia, Reverse Mortgage Daily and Market Watch.


Where can I find a reverse mortgage guide?

If you want a reverse mortgage guide, your most reliable guide is a trained reverse mortgage professional. Try contacting an established local firm for guidance.


What does countrywide reverse mortgage cause?

Reverse Mortgage A reverse mortgage is a loan that allows homeowners age 62 and older to access a portion of the available equity in their homes without having to sell the home, give up title, or make monthly reverse mortgage payments.


How does an AARP Reverse Mortgage Calculator help seniors?

For varying proportions of seniors, managing a mortgage or reverse mortgage can become understandably complex. The AARP Reverse Mortgage Calculator simplifies the process to make it more palatable to seniors.


Do you still owe the house when you enter to reverse mortgage?

You still own the house if you have a reverse mortgage, yes.


What reverse mortgage calculator is the best one?

Opinions vary about which reverse mortgage calculator is the best, but a very good one is the AARP Reverse Mortgage Calculator. It provides estimates for two different reverse mortgage programs to tell you how much money you might receive under the plan.


What is a ct reverse mortgage?

Ct reverse mortgage isn't a type of mortgage it is a reverse mortgage that takes place in the state of Connecticut. A reverse mortgage is a loan for senior homeowners that uses a portion of the homes equity as collateral. The loan generally does not have to be repaid until the last surviving homeowner permanently moves out of the property or passes away.


Where can one read about the pros and cons of a reverse mortgage?

One can read about the pros and cons of a reverse mortgage on real estate or banking websites. They offer information about the pros and cons of a reverse mortgage before the reader decides to register for a mortgage.