Reverse mortgages enable eligible homeowners to access the money they have built up as equity in their homes. They are primarily designed to strengthen seniors’ personal and financial independence by providing funds without a monthly payment burden during their lifetime in the home. The major eligibility requirements are that the applicant must be at least 62 years of age and own and occupy a home whose mortgage has been paid in full (or with only a very low
mortgage balance remaining).
The Benefits of a Reverse Mortgage include:
Tax-free funds for as long as you live in your home
No loan repayment for as long as you live in your home
No income, medical or credit requirements
Retain ownership of your home for life; this is guaranteed as long as you maintain your home,
and pay insurance and real estate taxes
Choose a cash flow plan tailored to your needs
No resrictions on how you may use the funds
A tax-advantaged way to pass on part of your estate today
How to Play it Safe?
The following four steps will help you ensure a successful reverse mortgage experience:
1). Because reverse mortgages offer unique benefits, it is important for you to get a solid grasp of how they work. Among other things, you need to understand the full array of reverse mortgage products available to determine which one is best suited to your financial priorities.
In addition, I can supply you with a list of reverse mortgage counselors with whom
you can discuss reverse mortgages in detail (in person or over the phone). Ask questions. If the answers aren’t clear to you, ask more questions. It’s the counselor’s job to help you understand. If you do not feel that you and your counselor are communicating well, give me a call and I can refer you to someone else.
2). It’s your house, and it should be your decision whether to apply for a reverse mortgage. Sometimes advice from family members or others can be helpful — but don’t let anyone else make up your mind for you. Once you apply, we hope you’ll feel very happy about it. But you still have the right to change your mind until 3 days after the loan is closed
3). How to use the money is entirely up to you. Among other possibilities, you could:
Supplement your retirement income
Buy a new car
Make home repairs
Use it as a financial planning tool
Travel more frequently
Help pay for a grandchild’s education
Cover medical expenses
Sometimes consumers learn about reverse mortgages from a business that offers a particular product or service (such as home remodeling or an annuity). Although most Reverse Mortgage lenders require that all liens be paid off and that the home be in good structural repair at closing, a reverse mortgage funded by Fannie Mae is never contingent upon your spending your money with any particular service provider. You are free to use your reverse mortgage funds in any way you wish. If anyone tries to tell you otherwise, please contact me and we'll get you in contact with a HUD representative.
4). The funds from your reverse mortgage (after closing related transaction costs) are yours alone, as the owner(s) of your home. Even if you plan to use the money to pay someone else later, the funds should always come to you first. Don’t let anyone persuade you to “sign over” the funds. In most cases, Fannie Mae-authorized lenders are obligated to make the check payable to you and to no other third party. Or, if you prefer, you have the right to choose an electronic transfer of the funds directly to your bank account. If you are using your reverse mortgage funds to purchase a new home, the funds will go to the seller at closing as authorized by you.
That's it for today, more to come very soon.
Have a great Tuesday.
No comments:
Post a Comment