In a reverse mortgage loan (also referred to as a a home equity conversion loan), borrowers of a certain age may use home equity for anything they need without selling their homes. The lender pays out funds determined by the equity you've accrued in your home; you receive a lump sum, a payment each month or a line of credit. Repayment isn't necessary until the borrower puts his home up for sale, moves (such as to a care facility) or dies. When you sell your property 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 finance charges.
The requirements of a reverse mortgage generally include being sixty-two or older, using the house as your primary living place, and holding a small balance on your mortgage or owning your home outright.
Reverse mortgages can be great for retired homeowners or those who are no longer bringing home a paycheck and have a need to supplement their limited income. Social Security and Medicare benefits are not affected; and the funds are not taxable. Reverse Mortgages can have adjustable or fixed rates. The lender will not take away your home if you live past the loan term nor may you be obligated to sell your residence to repay the loan amount even when the loan balance is determined to exceed current property value. Call us at (760) 632-7701 to look into your reverse mortgage options.
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