In a reverse mortgage loan (also called a home equity conversion loan), homeowners of a certain age may use home equity for anything they need without having to sell their homes. The lender gives you funds determined by your home equity amount; you receive a lump sum, a payment every month or a line of credit. The borrowed money doesn't have to be paid back until the homeowner sells the home, moves out, or passes away. You or representative of your estate has to repay the reverse mortgage loan, interest accrued, and finance charges at the time your house is sold, or you can no longer call it your primary residence.
Most reverse mortgages require youto be at least sixty-two years old, have a low or zero balance in a mortgage and maintain the home as your main living place.
Many homeowners who are on a fixed income and find themselves needing additional funds find reverse mortgages ideal for their situation. Interest rates may be fixed or adjustable while the funds are nontaxable and don't adversely affect Medicare or Social Security benefits. Your house can never be at risk of being taken away from you by the lending institution or put up for sale against your will if you outlive your loan term - even if the property value creeps under the loan balance. If you'd like to learn more about reverse mortgages, please contact us at 469-640-0400.
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