In a reverse mortgage (sometimes referred to as a a home equity conversion loan), homeowners of a certain age may use home equity for living expenses without selling their homes. Choosing between a monthly amount, a line of credit, or a lump sum, you can get a loan based on your home equity. Paying back your loan is not necessary until after the homeowner puts his home up for sale, moves (such as to a care facility) or dies. You or representative of your estate has to pay back the reverse mortgage amount, interest accrued, and finance fees at the time your house is sold, or you are no longer living in it.
The conditions of a reverse mortgage loan usually are being 62 or older, using the property as your main living place, and holding a small balance on your mortgage or having paid it off.
Many homeowners who live on a fixed income and need additional money find reverse mortgages advantageous for their situation. Rates of interest can be fixed or adjustable while the funds are nontaxable and do not adversely affect Social Security or Medicare benefits. The home will never be at risk of being taken away by the lender or sold without your consent if you outlive the loan term - even if the property value creeps under the balance of the loan. If you would like to learn more about reverse mortgages, please call us at 866-300-1550.
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