Reverse mortgages (also referred to as "home equity conversion loans") give older homeowners the ability to tap into home equity without selling their home. The lending institution pays out money based on the equity you've built-up in your home; you receive a one-time amount, a monthly payment or a line of credit. Paying back your loan isn't necessary until the borrower sells the property, moves (such as to a care facility) or dies. You or representative of your estate has to pay back the reverse mortgage loan, interest accrued, and finance charges when your house is sold, or you can no longer call it your primary residence.
The conditions of a reverse mortgage loan generally include being sixty-two or older, maintaining the house as your primary residence, and holding a low balance on your mortgage or having paid it off.
Many homeowners who live on a limited income and need additional money find reverse mortgages helpful for their circumstance. Interest rates may be fixed or adjustable and the money is nontaxable and doesn't affect Medicare or Social Security benefits. Your lending institution will not take the property away if you live past the loan term nor may you be forced to sell your home to repay your loan even if the balance grows to exceed current property value. Call us at (888) 299-4585 if you would like to explore the benefits of reverse mortgages.