What is a Reverse Mortgage?
A Reverse Mortgage is a lien, similar to a conventional loan, except the interest due each month is added to the balance so the loan goes up instead of down (hence the term reverse mortgage). This allows the borrower the freedom to not have to make monthly payments on the loan. As a result, the borrower can then utilize the equity in their home to pay off current mortgages, pull cash out for home improvements, or pay off other withstanding debt. Borrowers can also elect to have a portion of the funds available as a home equity line of credit as well. This can be beneficial to have available for unforeseen expenses. A Reverse Mortgage is designed to help homeowners 62+ to obtain financing that they would typically not qualify for.
What are the benefits of a Reverse Mortgage Loan?
- The main benefit of a reverse mortgage is to help homeowners 62+ to reduce their monthly expense or obtain cash out of their property
- NO fico requirements to qualify
- Reduced income requirement to qualify
- Benefits are based on the property value and age of the borrower
- Home Equity Line of Credit to have reserves for future unforeseen expenses
Who qualifies for a reverse mortgage.
Homeowners who are 62+ with good payment history for the last two years on mortgage loans, property taxes, and insurance would be the best fit for a Reverse Mortgage Loan. Exceptions can be made for qualification as long as there is enough equity in the property to set aside future property taxes and homeowner’s insurance payments.
Do I still own my home with a Reverse Mortgage?
YES, you still own the home. A Reverse Mortgage is similar to other mortgage products, meaning that there is only a lien placed on the property which still allows you to sell the property anytime in the future.
How is the loan paid back?
Every month the interest due on the loan is added to the balance. When you are deceased, your heirs will have 6 months to either refinance the current balance or sell the property to pay off the lien. This allows your heirs to share in the remaining equity in the home. In unusual circumstances, borrowers can ask for an additional 6 months to settle the current balance or sell the home.
Why work with Adequate Mortgage Service for your Reverse Mortgage needs?
We are very knowledgeable about reverse mortgages through personal experience. Our team is happy to assist any homeowner 62+ with all the questions they may have about this process and how it could be beneficial to their specific circumstance.
What kind of documentation is needed to get started?
- Loan Application which can be taken over the phone in 15 minutes or via this link https://form1003.my220.com/index.php/form?domainName=www.timkylelends.com
- Current Mortgage Statement.
- Homeowners Insurance Declarations Page
- HOA statement (if applicable).
- Driver’s License and Social Security Card – front and back
- Current award letter showing proof of any retirement benefits.