Reverse mortgages are often misunderstood and there are always a lot of questions.
Here are some of the most frequently asked questions with the answers.
How Does a Reverse Mortgage Work?
A reverse mortgage is secured by the equity in your home. Unlike a traditional mortgage where you make regular payments, there is no monthly payment required.
The big advantage of a reverse mortgage is that you don’t have to make regular mortgage payments as long as you or your spouse lives in your home.
Who is it for?
A reverse mortgage is designed exclusively for homeowners 55 and over. This age qualification applies to both you and your spouse.
How much can I get and how is it calculated?
You can receive up to 55% of the value of your home. The specific amount depends on your and your spouse’s age, the location and type of home you own, and the current appraised value of your home.
You can contact me and I can quickly give you an estimate of how much you might be approved for.
How do I get the money?
You can choose how you want to receive the money. A reverse mortgage gives you the option of receiving all the money you’re entitled to in one lump sum advance, or you can take it now and later, or you can receive scheduled advances over a specified period of time.
Will the owner owe more than the house is worth?
The owner retains all of the equity in the house.
In my many years of experience, over 99% of homeowners still have money when their mortgage is paid off.
The remaining equity depends on the amount borrowed, the value of the home, and how long it has been since you took out the reverse mortgage.
Will the bank own the house?
No. The owner retains title and retains ownership of the house. It is necessary for the homeowner to live in the house, pay taxes on time, have home insurance, and keep the property in good repair.
What if the owner already has a mortgage?
Many of our clients use a reverse mortgage to pay off their mortgage and existing debts.
Should reverse mortgages only be considered as a last resort?
No. Many finance professionals recommend a reverse mortgage to supplement monthly income instead of selling and downsizing, or taking out a conventional mortgage or line of credit.
What fees are associated with a reverse mortgage?
There are one-time fees for arranging a reverse mortgage, such as appraisal fees, fees for independent legal advice, as well as administration, title insurance, and registration fees.
With the exception of the evaluation fee, these fees are paid with Funding Dollars.
What if the owner can’t afford to pay?
No monthly payment is required as long as the owner lives in the house.
If you are interested in more information on a reverse mortgage, please call me if you have any questions at 1-888-561-2679 or email [email protected]