In a reverse mortgage (sometimes referred to as a a home equity conversion loan), homeowners of a certain age may use home equity for living expenses without selling their homes. Deciding how you would like to be paid: by a monthly payment, a line of credit, or a lump sum, you may get a loan based on your equity. Paying back your loan isn't required until when the borrower sells the property, moves (such as into a retirement community) or passes away. When your home sells or you no longer use it as your main residence, you (or your estate) must pay back the lender for the cash you obtained from your reverse mortgage plus interest among other fees.
Most reverse mortgages require youto be at least sixty-two years of age, have a small or zero balance in a mortgage and use the property as your principal residence.
Many homeowners who are on a limited income and have a need for additional funds find reverse mortgages advantageous for their circumstance. Social Security and Medicare benefits are not affected; and the funds are not taxable. Reverse Mortgages may have adjustable or fixed rates. Your lending institution can't take away your residence if you live past the loan term nor will you be required to sell your residence to pay off your loan amount even if the loan balance is determined to exceed current property value. Call us at (415) 406-2330 if you'd like to explore the advantages of reverse mortgages.