In a reverse mortgage (also called a home equity conversion loan), borrowers of a certain age may use home equity for anything they need without having to sell their homes. Deciding how you'd prefer to to receive your funds: by a monthly amount, a line of credit, or a one-time payment, you can get a loan amount determined by your home equity. Paying back your loan is not required until after the borrower sells the property, moves (such as to a retirement community) or passes away. You or your estate representative must repay the reverse mortgage loan, interest accrued, and finance charges at the time your property is sold, or you are no longer living in it.
The requirements of a reverse mortgage loan typically are being 62 or older, maintaining the property as your primary living place, and holding a low balance on your mortgage or owning your home outright.
Reverse mortgages are ideal for homeowners who are retired or no longer bringing home a paycheck and must add to their limited income. Social Security and Medicare benefits won't be affected; and the money is not taxable. Reverse Mortgages may have adjustable or fixed interest rates. The home will never be at risk of being taken away by the lending institution or sold against your will if you outlive the loan term - even if the property value creeps under the loan balance. If you would like to learn more about reverse mortgages, feel free to contact us at 720-598-8300.
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