In a reverse mortgage loan (also called a home equity conversion loan), homeowners of a certain age may use home equity for living expenses without selling their homes. Choosing between a monthly payment amount, a line of credit, or a lump sum, you may receive a loan amount determined by your home equity. The loan doesn't have to be repaid until the borrower sells his residence, moves away, or passes away. You or representative of your estate has to pay back the reverse mortgage loan, interest accrued, and other finance charges at the time your house is sold, or you can no longer use it as your primary residence.
Most reverse mortgages are appropriate for borrowers who are at least sixty-two years of age, have a low or zero balance in a mortgage and use the property as your principal living place.
Reverse mortgages can be great for retired homeowners or those who are no longer working but have a need to add to their income. Rates of interest may be fixed or adjustable while the money is nontaxable and doesn't interfere with Medicare or Social Security benefits. Your lender can't take away your residence if you live past the loan term nor may you be required to sell your home to pay off your loan even when the loan balance is determined to exceed current property value. If you'd like to find out more about reverse mortgages, feel free to call us at 954.920.9799.
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