Frequently Asked Questions about Reverse Mortgages
– What is a reverse mortgage?
A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. Borrowers do not have to repay the loan until the borrowers no longer use the home as their primary residence or fail to meet the obligations of the mortgage.
– Can I qualify for a reverse mortgage?
To be eligible you must be a homeowner 62 years of age or older. You must also own your home outright or have equity available in your home. You must also live in your home and it must be your primary residence.
– What types of homes are eligible?
To be eligible, your home must be a single family home. HUD-approved condominiums and manufactured homes that meet FHA requirements are also eligible.
– What are the differences between a reverse mortgage and a home equity loan?
With a second mortgage, or a home equity line of credit, borrowers must have adequate income to qualify for the loan, and they make monthly payments on the principal and interest. A reverse mortgage is different because it pays you – there are no monthly principal and interest payments. With a reverse mortgage, you are required to pay real estate taxes, utilities, and hazard/flood insurance.
– Will we have an estate that we can leave to heirs?
When the home is sold or no longer used as a primary residence, the cash, interest, and finance charges must be repaid. All proceeds beyond the amount owed belong to your spouse or estate. This means any remaining equity can be transferred to heirs. No debt is passed along to the estate or heirs.
– How much money can I get from my home?
The amount you may borrow will depend on:
– Age of the youngest borrower
– Appraised value of your home
– Current interest rate
For a brochure tailored to your financial situation please call 419-246-5959.
You may also contact us by filling out the form below…