Who Can Benefit From A Reverse Mortgage?
Reverse mortgages are becoming an increasingly popular lending
option for older Americans. Reverse mortgages allow homeowners
over the age of 62, the ability to convert a portion of their
homes� equity into cash, which they can receive in monthly
installments or through a line of credit. This short article
will provide a brief overview of the reverse mortgage process.
Reverse mortgages provide a sense of financial security for
older Americans because they provide a supplement to social
security income.
Individuals may receive payments on a term, tenure or
line-of-credit basis. Repayment of the loan is not required
unless and until the home owner decides to sell the home, or no
longer uses the home as his/her primary residence. When either
of these two conditions is met, the homeowner is then required
to pay back the cash they received from the reverse mortgage.
This repayment includes interest and other fees. The remaining
equity, if any, belongs to the homeowner.
In order to be HUD eligible for a reverse mortgage loan, an
individual must obviously own the home in question, must be 62
years or older, own the home outright, or have a mortgage
balance low enough so that the mortgage balance can be paid in
full at closing with the proceeds from the reverse loan. The
individual must also go through HUD approved counseling. Single
family homes, two or four unit properties, town homes, detached
homes and some condominiums and manufactured homes are all
eligible for a reverse mortgage.
Reverse mortgages can be a great option for older Americans.
They provide extra income that often helps older Americans meet
their financial needs. It is an extremely attractive option for
individuals who plan to stay in their homes indefinitely,
because the loan does not have to be repaid unless the
individual moves out of the house.
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