Reverse mortgages (also referred to as "home equity conversion loans") enable older homeowners to benefit from their equity without the necessity of selling their home. The lender gives you funds determined by your home equity amount; you receive a one-time amount, a payment each month or a line of credit. Repayment isn't required until after the homeowner sells the property, moves (such as into a retirement community) or dies. You or an estate representative is required to pay back the reverse mortgage loan, interest accrued, and finance fees after your house is sold, or you are no longer living in it.
Generally, reverse mortgages require you be at least sixty-two years of age, have a low or zero balance in a mortgage and maintain the home as your main living place.
Homeowners who live on a limited income and need additional money find reverse mortgages ideal for their situation. Rates of interest can be fixed or adjustable while the money is nontaxable and does not affect Social Security or Medicare benefits. Your lending institution can't take the property away if you outlive your loan nor will you be forced to sell your home to repay your loan even if the loan balance grows to exceed current property value. If you would like to find out more about reverse mortgages, feel free to call us at (919) 771-3379.