With a reverse mortgage loan (also referred to as a a home equity conversion loan), borrowers of a certain age may use home equity for anything they need without selling their homes. The lender gives you funds determined by your home equity amount; you get a lump sum, a payment every month or a line of credit. The borrowed money does not have to be paid back until the homeowner sells the home, moves out, or passes away. You or your estate representative is required to repay the reverse mortgage amount, interest , and finance fees at the time your house is sold, or you are no longer living in it.
Generally, reverse mortgages are available for borrowers who are at least sixty-two years of age, have a small or zero balance in a mortgage and use the house as your principal residence.
Many homeowners who are on a fixed income and find themselves needing additional funds find reverse mortgages advantageous for their situation. Social Security and Medicare benefits aren't affected; and the funds are not taxable. Reverse Mortgages may have adjustable or fixed interest rates. The home will never be in danger of being taken away by the lender or put up for sale against your will if you outlive the loan term - even if the current property value creeps below the loan balance. If you'd like to find out more about reverse mortgages, please contact us at 720-598-8300.
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