With a reverse mortgage (technically known as a home equity conversion loan or HECM), homeowners of a certain age may use home equity for anything they need without selling their homes. Deciding how you would prefer to to receive your funds: by a monthly payment, a line of credit, or a lump sum, you can get a loan based on your home equity. Paying back your loan is not required until when the borrower puts his home up for sale, moves (such as into a care facility) or dies. You or representative of your estate has to repay the reverse mortgage loan, interest accrued, and finance charges at the time your house is sold, or you are no longer living in it.
The requirements of a reverse mortgage loan normally are being sixty-two or older, using the home as your main residence, and having a low remaining mortgage balance or owning your home outright.
Many homeowners who are on a limited income and need additional funds find reverse mortgages advantageous for their circumstance. Social Security and Medicare benefits aren't affected; and the funds are nontaxable. Reverse Mortgages may have adjustable or fixed rates. The lending institution will not take the property away if you live past the loan term nor will you be obligated to sell your residence to pay off the loan even when the loan balance grows to exceed current property value. Contact us at (408) 626-1879 if you want to explore the advantages of reverse mortgages.
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