Friday, September 17, 2010

Reverse Mortgage Benefits

Until the HECM Reverse Mortgage was introduced the only 2 ways you could use the equity in your home was to sell the home and move out or take out a loan which required monthly payments. If you own your home (or have lots of equity) and the youngest person living in the home is 62 years of age you are most likely eligible.

With the "Reverse" mortgage you do not have to do either of the above. A reverse mortgage is a loan which allows you to take the equity out of your home while continuing to live in it. You most likely never have to make a payment back until you die, sell the home or permanently move out.

You may receive the money in a lump sum, regular monthly cash advance or a creditline that allows withdrawals when needed. Your income levels do not matter because you do not have to make a payment back. If you had no income and owned your home you could still qualify.

Even though you receive a "Reverse" mortgage, you still own your home, so the homeowner will still be responsible for property taxes, homeowner's insurance and routine upkeep of the home. Once neither of the homeowners live in the house as their primary residence the heirs may then sell the home and repay the lien. If there is money left it is given to the estate.

More to come on Reverse Mortgages. If you have any specific questions you would like Valerie Springer to discuss please contact me at valerie.springer@nflp.com

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