| 1. |
What is a Reverse Mortgage? Answer |
| 2. |
Who is eligible for a Reverse Mortgage? Answer |
| 3. |
What can a Reverse Mortgage do for me? Answer |
| 4. |
How much money can I get from my home? Answer |
| 5. |
How will I receive the money? Answer |
| 6. |
I still have a mortgage on my home. Can I still obtain a Reverse Mortgage? Answer |
| 7. |
Are Reverse Mortgages safe? Answer |
| 8. |
Are there costs associated with a Reverse Mortgage? Answer |
| 9. |
With a Reverse Mortgage, will I still have an estate to leave my heirs? Answer |
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Q
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What is a Reverse Mortgage? |
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A
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Designed for seniors age 62 and older, a reverse mortgage is a loan that allows homeowners to convert some of their equity into cash or monthly income without having to sell their home.
As a senior with a reverse mortgage, you'll make no monthly payments and the loan only becomes due when the last borrower permanently leaves the home. |
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Q
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Who is eligible for a Reverse Mortgage? |
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A
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Everyone who will be on the title must be at least 62 years of age and must occupy the home as their principal residence. Income is not required to qualify. Credit scores are not a factor, either! |
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Q
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What can a Reverse Mortgage do for me? |
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A
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A Reverse Mortgage allows you to:
- Remain independent--you remain in your home and retain ownership of it.
- Continue to live in your home--there's no place like it!
- Have no monthly mortgage payments--you need not pay back the reverse mortgage until the last borrower moves out of the home.
- Receive tax-free money--the equity in your home is not considered income and will not affect your Social Security or Medicare benefits. Always consult your tax advisor.
- Retain your freedom--you are free to use the money any way you like!
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Q
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How much money can I get from my home? |
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A
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The amount of cash available from a reverse mortgage depends on
- Your age
- The value of your home
- Current interest rates
- FHA's lending limits for your area
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Q
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How will I receive the money? |
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A
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You decide. With most reverse mortgages, you have a wide range of options, one of which will be ideal for your situation. You can:
- Receive all the available money at once as a lump sum
- Receive equal monthly payments for as long as one of the borrowers continues to occupy
- Receive equal monthly payments for a fixed period of time
- Obtain a Line of Credit that allows you to take funds at the times and amounts of your choosing
- A combination of the above
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Q
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I still have a mortgage on my home. Can I still obtain a Reverse Mortgage? |
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A
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Yes. You may be eligible for a reverse mortgage even if you already have a mortgage. Your Reverse Mortgage funds will first go toward paying off the existing mortgage. |
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Q
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Are Reverse Mortgages safe? |
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Absolutely. Reverse Mortgages are regulated by the U.S. Department of Housing and Urban Development (HUD) are are subject to more consumer protection laws than any other financial product.
Plus, you can never owe more than the value of your home and you retain the title to your home. |
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Q
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Are there costs associated with a Reverse Mortgage? |
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A
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Yes, there are fees for loan origination, property appraisal, credit reporting, FHA mortgage insurance premium, and other items. These charges can be paid using the Reverse Mortgage itself. |
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Q
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With a Reverse Mortgage, will I still have an estate to leave my heirs? |
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A
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Yes. When you sell your home or stop using it as your primary residence, you or your estate must repay the cash received from the Reverse Mortgage along with interest and associated fees. All remaining equity belogs to you or your heirs.
You will never owe more than your home's appraised value and none of your other assets will be affected by your Reverse Mortgage. |
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