How Does Your Mortgage Fit Into Your Next Chapter?
What is a Reverse Mortgage?
Geared towards homeowners ages sixty-two and older; reverse mortgages allow owners to pull out equity to pay off their mortgage sooner.
What Are Some Benefits?
If an elderly homeowner’s net worth is tied-up in their home – paying down their mortgage may offer them more flexibility in their later years.
Want to Know More About Reverse Mortgages?
Reverse mortgages are a certain type of FHA loan which means they’re backed federally, giving homeowners more security. The way it works is that when an owner moves or passes – the reverse mortgage funds goes to the lender and whatever is left over goes either to the still-living owner or to their beneficiaries.
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Do I Qualify?
To qualify, owners need about 50% equity in their home to typically secure an HECM (Home Equity Conversion Mortgage) which is the most common type of reverse mortgage. HECM is offered for homes priced $765,600 and below — homes valued above that require a jumbo reverse mortgage or a proprietary reverse mortgage.
Mortgage Rules You Need To Know
When you take out a reverse mortgage, you can choose to receive the proceeds in one of six ways. Term payments, Term payments plus a line of credit, Lump sum, Line of credit, Equal monthly payments, and Equal monthly payments plus a line of credit.