Reverse Mortgages

With the current economic difficulties, a lot of homeowners are finding themselves defaulting on their monthly mortgages or worse in danger of foreclosure. Retirees and senior Americans particularly are one of the hardest hit sectors of the population. With rising healthcare cost and the value of their pensions dropping making the next mortgage payment is becoming more and more difficult.

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-        Reverse Mortgages: Helping the Elderly

-        Home loans: Releasing Home Equity

 

 Lifetime or Reverse mortgages are loans specifically designed to offer senior Americans an alternative way of converting home equity into available cash. This allows homeowners to convert equity paid over the years into cash which could be collected in one lump sum or released thru multiple payments.

 

As opposed to Second Mortgages, Home Equity loans, and HELOC’s there is no pressure for the homeowner to repay the loan unless the borrower chooses to leave their residence, the home is sold or the owner dies. There are no legal obligations which require the homeowner to pay the loan but when the owner chooses not to pay the property all rights to the home is turned over to the loaning institution.

 

Senior homeowners who choose to convert their home loans into Reverse mortgages are released of their obligations of making monthly mortgage payments. However, homeowners who find themselves capable of paying these new loans in the future may do so.

 

These types of mortgages are readily available for retirees and senior Americans with or without a stable source of income. The maximum available amount of loan basically depends on the person’s age, interest rates and the current market value of their homes.

 

Requirements and Qualifications for Reverse Mortgages:

 

1.      Reverse mortgages are only available for senior Americans aged 62 and above.

2.      The loaned property must be considered as their primary residence.

3.      All borrowers are required to attend counseling sessions conducted by individuals authorized by the Federal Housing Authority or FHA.

4.      Prior to final approval, homes are required to meet FHA standards for housing and actual market is assessed.

5.      Homeowners are responsible for the home’s upkeep including maintenance, taxes and insurance.

 

 

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