Reverse mortgages (also referred to as "home equity conversion loans") enable older homeowners to tap into home equity without selling their home. Choosing between a monthly amount, a line of credit, or a one-time payment, you can take out a loan based on your equity. Paying back your loan isn't necessary until when the borrower sells the property, moves (such as into a retirement community) or dies. When you sell your home or you no longer use it as your main residence, you (or your estate) are required to repay the lender for the funds you obtained from the reverse mortgage plus interest and other fees.
Most reverse mortgages require you be at least sixty-two years of age, have a small or zero balance owed against the home and maintain the house as your principal living place.
Reverse mortgages can be advantageous for retired homeowners or those who are no longer working but need to supplement their limited income. Rates of interest can be fixed or adjustable and the money is nontaxable and does not adversely affect Social Security or Medicare benefits. Your home is never at risk of being taken away from you by the lending institution or sold against your will if you live longer than the loan term - even if the current property value dips under the balance of the loan. If you'd like to learn more about reverse mortgages, feel free to contact us at 407-834-3377.
Do you have a question regarding a mortgage program?