With a reverse mortgage loan (also called a home equity conversion loan), homeowners of a certain age may use home equity for anything they need without selling their homes. The lending institution pays out funds based on the equity you've accrued in your home; you receive a one-time amount, a monthly payment or a line of credit. Paying back your loan isn't necessary until after the borrower sells the home, moves (such as to a retirement community) or passes away. When you sell your home or is no longer used as your main residence, you (or your estate) must pay back the lending institution for the cash you received from your reverse mortgage in addition to interest among other fees.
The conditions of a reverse mortgage loan usually are being sixty-two or older, maintaining your property as your main residence, and having a small remaining mortgage balance or owning your home outright.
Many homeowners who are on a fixed income and have a need for additional funds find reverse mortgages helpful for their situation. Social Security and Medicare benefits will not be affected; and the funds are not taxable. Reverse Mortgages may have adjustable or fixed interest rates. The residence will never be at risk of being taken away from you by the lending institution or sold without your consent if you live longer than the loan term - even if the property value dips below the loan balance. If you'd like to learn more about reverse mortgages, feel free to call us at 866-300-1550.
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