A simple reverse mortgages explanation
Seniors can deal with the financial uncertainty they experience by using a reverse mortgage. Retirement can be tough on the financial side, and a reverse mortgage gives them the breathing room they need to enjoy their retirement.
For many seniors, income is low compared to the days when they were working. Not only that, costs are rising. Especially living costs and medical costs. What many seniors do not realize, is that they can use their house to access extra funds to enjoy retirement. This is where the reverse mortgage comes in. A reverse mortgage enables a senior to use the equity that's built up in a house and turn it into cash.
A reverse mortgage does not take away ownership of the house. The house still belongs to the senior and they are free to profit from a rise in the home value in the future. The homeowner can pay off the reverse mortgage at any time, or not at all if he so chooses. When the titleholder passes away, the reverse mortgage is paid off first by the proceeds of the sale of the house.
To qualify for a reverse mortgage, you must be 62 years old or older and there must be equity in the home. Income or credit qualifications don't matter. If there is a lien or a mortgage left on the house, this is oftentimes paid off by the proceeds from the reverse mortgage.
The best thing about a reverse mortgage is that the homeowner is free to spend the money as he sees fit. Many times it's used for home improvement, travel and enjoying retirement by having extra financial possibilities. The amount of the proceeds of the reverse mortgage depends on the age of the senior and the amount of equity in a house. With no monthly payments needed, a reverse mortgage is an ideal way for any senior to supplement income in these slim times.
For many seniors, income is low compared to the days when they were working. Not only that, costs are rising. Especially living costs and medical costs. What many seniors do not realize, is that they can use their house to access extra funds to enjoy retirement. This is where the reverse mortgage comes in. A reverse mortgage enables a senior to use the equity that's built up in a house and turn it into cash.
A reverse mortgage does not take away ownership of the house. The house still belongs to the senior and they are free to profit from a rise in the home value in the future. The homeowner can pay off the reverse mortgage at any time, or not at all if he so chooses. When the titleholder passes away, the reverse mortgage is paid off first by the proceeds of the sale of the house.
To qualify for a reverse mortgage, you must be 62 years old or older and there must be equity in the home. Income or credit qualifications don't matter. If there is a lien or a mortgage left on the house, this is oftentimes paid off by the proceeds from the reverse mortgage.
The best thing about a reverse mortgage is that the homeowner is free to spend the money as he sees fit. Many times it's used for home improvement, travel and enjoying retirement by having extra financial possibilities. The amount of the proceeds of the reverse mortgage depends on the age of the senior and the amount of equity in a house. With no monthly payments needed, a reverse mortgage is an ideal way for any senior to supplement income in these slim times.
About the Author:
Mijnadviseur writes articles about mortgages in English, he also writes articles about beleggingshypotheek and hypotheekrente berekenen in Dutch.
posted by Credit Counseling at
1:01 AM
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