Reverse mortgages (also referred to as "home equity conversion loans") give older homeowners the ability to tap into home equity without having to sell their home. The lender pays you funds based on the equity you've built-up in your home; you get a lump sum, a payment every month or a line of credit. The loan doesn't have to be repaid until the homeowner sells his home, moves away, or dies. At the time your home sells or is no longer used as your main residence, you (or your estate) must repay the lender for the funds you got from your reverse mortgage as well as interest among other fees.
Typically, reverse mortgages require youto be at least 62 years of age, have a small or zero balance in a mortgage and maintain the property as your main residence.
Many homeowners who are on a fixed income and need additional money find reverse mortgages advantageous for their circumstance. Interest rates may be fixed or adjustable while the money is nontaxable and does not adversely affect Social Security or Medicare benefits. Your lender is not able to take away your residence if you live past the loan term nor may you be made to sell your residence to pay off your loan even if the loan balance grows to exceed current property value. If you would like to learn more about reverse mortgages, please call us at 2147390569.