Many homeowners have found that a reverse mortgage loan is a great way for them to take advantage of the equity they have built up in their homes.
A reverse mortgage loan is different from a traditional mortgage. With a traditional mortgage loan you make monthly mortgage payments, but with a reverse mortgage loan the lender pays you money through monthly installments, a one-time lump sum payment, a line of credit or a combination of a line of credit and monthly installments. The money that you are eligible receive is dependent on your age, the value of your home and the current interest rate.
Coral Springs residents may be interested in reverse mortgage loans as a way to improve their financial situation in retirement. A reverse mortgage loan is a loan that you take out based on the equity you have built in your home. Because it requires equity, it is not a good choice for younger people and in fact, if you are under 62 you not eligible.
One of the great advantages of a reverse mortgage loan is that you are not required to pay the loan back. Only if the home is no longer your primary residence, you fail to maintain the home, fail to pay property taxes and/or homeowner's insurance or do not otherwise comply with the terms of the loan will repayment become enforceable. For more information on when a reverse mortgage loan comes due click the following link: What about Repaying a Reverse Mortgage Loan.
Another advantage of reverse mortgages is that there is no risk of defaulting; the loan isn't due until you leave the home or violate any of the term regarding upkeep and maintenance so you can't lose your home. You also can't be required to pay back more than the value of your home, even if you were loaned more than that. That means that there's no risk that you won't be able to pay back the loan, because when you sell the house, you'll be guaranteed to have enough to pay off the loan.
Reverse mortgages are popular because they allow you to continue living in your home with no mortgage payments and you may qualify for extra income each month to spend however you please. Reverse mortgages are tax free whether you receive the money as a lump sum or as monthly payments.
Coral Springs residents interested in a reverse mortgage should consider a couple of things before they get one. First, if you're eligible for low-income assistance like Medicaid, be sure that the proceeds from the loan won't make you ineligible. Second, remember that a reverse mortgage loan will eventually have to be paid back by selling the home. This means proceeds from the sale will be used to pay the reverse mortgage. Your children or legal heirs will not benefit from the equity you've built in the home used to repay the reverse mortgage.
If you’re aged 62 or older and own your home you might be eligible for a reverse mortgage loan. Contact Sunshine State Mortgage to find out more about reverse mortgage loans and ways to make it work for you, or apply now and start the process of tapping into the equity in your home. Visit www.nopaymentsforlife.com for more information!
Check out these pages for more information about reverse mortgage loans.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.