The reverse mortgage often seems too good to be true, instead of paying lenders money, a lender pays you money! It feels like one of those things we all dream about but does not actually happen in reality. A reverse mortgage is not available to everyone; it is only available to senior home owners. Reverse mortgage information is very simple to understand once you get down to the basics of this incredible payment option.
How It Works
A reverse mortgage is available to anyone aged 62 and above. This mortgage repayment plan allows you to convert equity in your home into cash. The best part about a reverse mortgage is that this income is tax free! You can enjoy your golden years with a little extra comfort with the money that comes from your home s equity.
The amount of money that you can receive from a reverse mortgage depends on your age, or the age of the youngest spouse, and the value of the home. A good rule of thumb is basically that the older you are and the more valuable your home is the more money you are entitled to.
You do not have to repay this loan in your lifetime. Once your home is sold should you pass away the repayment will be taken from the proceeds of your home. Repayment also occurs if you decide to sell your home, or move out of your home.
Home Requirements
Not all homes fill the criteria for a reverse mortgage, in some cases your home must be built after June 1976. It s important that you check that your home is eligible for a reverse mortgage. While in most cases cooperative houses do not meet the criteria for reverse mortgages there are some companies that will offer reverse mortgages to cooperative apartments in New York.
Payment Options
There are several ways in which you can choose to receive the money from your reverse mortgage. You can choose to receive the money in a lump sum, in a series of installments over a certain period of time or over a lifetime. However the most popular payment option is to receive a line of credit that you can draw over an unlimited period of time.
There is no limit on what you may use the money from your reverse mortgage for. The money is yours once you have it and can be used it any way that you see fit. Talk to a loan advisor today to see if your home meets the requirements.