Reverse Mortgage Basics
A Reverse Mortgage is a loan product created by the Department of Housing and Urban Development (HUD) in the late 1980’s to allow Senior Citizens to retire more comfortably by borrowing the equity in their homes. At it’s most basic definition, it’s a type of home loan where the lender pays you, instead of you paying the lender. This is the main difference between the reverse mortgage and the traditional mortgage and is the reason that it has become known as the \”Reverse\” mortgage. The most popular reverse mortgage is the Home Equity Conversion Mortgage, or HECM. HECM Loans are administered and insured by the FHA (Federal Housing Administration) and it’s completely safe.
Basic reverse mortgage requirements are:
>>Borrowers must be Age 62 years or older
>>Own their home and have enough equity in to qualify
>>Occupy the home as primary residence
>>Receive counseling by an approved HUD/FHA counselor
What is a Reverse Mortgage? It may just be the answer to your financial woes. Please read on. The best feature of a reverse mortgage is that the loan proceeds DO NOT HAVE TO BE PAID BACK, so long as the borrower lives in the home. This feature makes it perfect for seniors trying to retire on a less than sufficient nest egg.
>>Reverse Mortgage Payment Options
>>Lump Sum Disbursement
>>Monthly Payments
>>Line of Credit
>>A combination of the Above
A reverse mortgage pays money to you, as though you had sold your house. In this regard it acts like a typical home equity loan. You can receive monthly payments or a lump-sum payout based on the value of your house. In addition, you won’t have to move or even give up ownership to the home. The house remains yours, just as it is today, with your name on the title. Although this type of reverse mortgage loan is still a little misunderstood, we hope to help in clearing up some of that confusion. First, let’s see why you may want to consider a Washington reverse mortgage. There are several benefits to reverse mortgages, please see below:
>>The money you receive is tax free income
>>You may use the money anyway you like
>>No payments as long as you live in the home
>>No credit or income requirements
>>Reverse mortgages are supported by AARP
>>Reverse mortgages are insured by the FHA
With a reverse mortgage, you still own the home and you remain the owner for as long as you live there. Until you sell or move, you retain the title to your home. Unlike a traditional mortgage, however, your balance cannot exceed the value of your home when you sell it. So no matter how much money you receive through your reverse mortgage, you will never owe more than your home is worth. A reverse mortgage may not be right for everyone, but it may be right for you.
For more information on reverse mortgage rules and information, please visit Senior Reverse Mortgage Online or to locate a specialist in your area, please visit the Reverse Mortgage Directory.
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