Reverse mortgages (sometimes called "home equity conversion loans") enable older homeowners to tap into built-up equity without having to sell their home. Deciding how you'd prefer to to receive your funds: by a monthly payment, a line of credit, or a one-time payment, you can get a loan based on your home equity. The loan does not have to be paid back until the homeowner sells the residence, moves out, or passes away. At the time your house has been sold or you no longer use it as your main residence, you (or your estate) have to repay the lender for the money you got from your reverse mortgage in addition to interest among other finance charges.
The requirements of a reverse mortgage loan usually include being 62 or older, using the home as your main residence, and holding a small remaining mortgage balance or owning your home outright.
Many homeowners who are on a fixed income and find themselves needing additional funds find reverse mortgages ideal for their circumstance. Social Security and Medicare benefits can't be affected; and the money is nontaxable. Reverse Mortgages may have adjustable or fixed rates. As long as you reside in the property, maintain the property and continue paying property taxes and insurance your house is never in danger of being taken away by the lender or put up for sale against your will if you live longer than the loan term - even if the current property value dips below the balance of the loan. If you'd like to find out more about reverse mortgages, feel free to contact us at 603-893-6616.
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