RSS Blog FeedReverse Equity Mortgages
Posted at 9:08 PM, Jul. 27, 2007
Many retired homeowners are finding that they don’t have enough income to make ends meet and are turning, in huge numbers, to Reverse Equity Mortgages to see them through their retirement. According to the National Reverse Mortgage Lenders Association in Washington DC, the number of Federal Housing Administration insured reverse mortgages jumped by 77% nationally during the past fiscal year. This jump is probably attributed to, but not limited to, a TV campaign to increase awareness.
Reverse Mortgages are not new; they have been available through FHA since 1990. But they have not been popular due to many misconceptions by the general public. Potential borrowers mistakenly thought that they would have to give up title to their homes to the Government, or that the Government would take possession of their homes when they die.
Now, many people are using Reverse Mortgages as a financial planning tool. As the baby boomers near retirement, Reverse Mortgages will become even more popular.
What you need to know before taking out a Reverse Mortgage:
· You must be at least 62
· You must have equity in your home. You can get a reverse mortgage even if you are making monthly payments on your home.
· The amount you get depends on your age and the value and location of your home. The older you are, the more you can get.
· The home must be your primary residence.
· There are 2 types of Reverse Equity Mortgages: federally insured (FHA and Fannie Mae) and private lenders.
· You can receive money in a lump sum, in monthly payments, or through a line of credit, or a combination.
· The interest is calculated at an adjustable rate. It is paid when the loan is repaid.
· The loan must be repaid when you move out of the house or when you die.
If you would like to learn more about this type of loan, please feel free to call us and we will be more than happy to assist you.
View more entries tagged with: None