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The reverse mortgage program was designed to provide senior citizens an additional funding source for their retirement. There are a few requirements that you must meet to qualify for the program. There are also several points you must understand prior to entering into a reverse mortgage agreement.
Reverse mortgages can only be applied for if you are 62 years of age or older. You must own a home that has considerable equity. You may have a mortgage on it if the balance is very low. The home must be your main residence. You must continue to live in that home as a full time resident throughout the course of the loan. If you meet these guidelines you can apply for a reverse mortgage.
A reverse mortgage is a way for senior to live off of the equity in their home. Borrowers may choose either to receive the money as a lump sum or in monthly payments. Lumps sum payments are generally not encouraged because of the taxes that can be associated with this increase in income.
The loan is paid back when the home is sold after you move or die. Heirs to the estate will be given the first opportunity to purchase the home. If they do not want the house it will be put up for sale to cover the debt. If the reverse mortgage was not federally insured any remaining debt will fall onto the estate for payment.
Federally insured reverse mortgages are commonly known as Home Equity Conversion Mortgages. The HECM program offers an insurance policy, for a small premium, to guarantee that the debt is covered once you no longer occupy the home. When you are seeking out information about a reverse mortgage it is always well advised to consider a HECM option.
During the course of the loan you must maintain the property. Failure to make repairs or upkeep the home could result in a breech of contract. You must also keep all your taxes current. If you fall behind in your taxes the reverse mortgage company could call in the loan. These are very important factors you must keep in mind.
What else can I help you with?
Where can I get a reverse mortgage and more facts on it?
In order to get more in depth or detailed facts about reverse mortgage you will probably want to consult your mortgage broker. They will be able to give you up to date and factual information. Most websites will not give you verified information that you need, but some websites such as hud.gov should help you with any questions you have.
What are some facts about reverse mortgage?
For people 62 or older, a reverse mortgage can be a very good option. There are three different types of reverse mortgages. A single-purpose reverse mortgage is normally the least expensive option and is over seen by state and local government agencies. Federally-insured reverse mortgages can have high upfront costs. Proprietary reverse mortgages are provided by private companies that issue the loans.
How do I get facts on reverse mortgages?
A reverse mortgage is available to seniors age 62 or older and gives homeowners access to some of the equity in their home. It can be risky, depending on a variety of factors. If one of two people living in a home dies, the other spouse is obligated to pay back the loan. However, depending on the circumstances, it could possibly result in someone having to leave their home before they're ready. Speak to your mortgage lender for more information.
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