In a reverse mortgage loan (also called a home equity conversion loan), borrowers of a certain age may use home equity for living expenses without having to sell their homes. Choosing between 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 care facility) or passes away. At the time your house has been sold or is no longer used as your main residence, you (or your estate) must repay the lending institution for the money you got from your reverse mortgage as well as interest among other fees.
Most reverse mortgages are appropriate for homeowners who are at least sixty-two years of age, have a small or zero balance in a mortgage and maintain the house as your main residence.
Homeowners who are on a fixed income and find themselves needing additional money find reverse mortgages advantageous for their circumstance. Social Security and Medicare benefits can't be affected; and the money is not taxable. Reverse Mortgages can have adjustable or fixed rates. Your lender can't take away your residence if you outlive your loan nor can you be forced to sell your home to pay off your loan even when the balance is determined to exceed property value. If you'd like to learn more about reverse mortgages, please contact us at (760) 632-7701.
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