What is a reverse mortgage loan?

What is a Reverse Mortgage?

Reverse Mortgage is a special type of home loan that allows you to turn a portion of your home's equity into cash, receivable in a variety of ways. Unlike mortgages, no repayment of the loan is required until the last borrowers have permanently left home.

In 1988, the Department of Housing and Urban Development (also known as H.U.D.) started a pilot program to help seniors more easily convert the equity in their homes to cash. Today, the Reverse Mortgage Program is now one of the fastest growing segments of the mortgage industry.

Who Qualifies?

Both homeowners must be 62 years old or older and you must use your home as a primary residence.

Benefits of a Reverse Mortgage

The loan is a government insured F.H.A. product, allows you to continue to live in your home.
You retain ownership of your home, providing you continue to pay taxes and insurance.
Make no monthly mortgage payments.
There are no income, credit or health qualifications.
You decide how you wish to receive your cash disbursements.
And Repay the loan at any time without penalty.


Common Myths

Myth 1: The bank can take the home.
False! By the terms of the reverse mortgage, you retain the title to the home. There is no way you can be forced out of your home.

Myth 2: The home must be owned free to clear to qualify.
False! As long as you have equity in your home, you may qualify.

Myth 3: At the time that a reverse mortgage is due, the bank will sell the home.
FALSE! The borrower or the borrower's heirs are in control of the home and title. At that point the home can either be sold or refinanced by a heir.

Reverse mortgages are all about making the most of the equity that you have acquired in your home.

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Education

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• reverse mortgage
• loan
• finance
• wealth management