Reverse mortgages (also referred to as "home equity conversion loans") enable older homeowners to tap into equity without selling their home. The lending institution pays out funds determined by the equity you've accrued in your home; you receive a one-time amount, a monthly payment or a line of credit. The loan does not have to be paid back until the borrower sells the home, moves out, or dies. You or representative of your estate must pay back the reverse mortgage amount, interest accrued, and other finance fees when your home is sold, or you are no longer living in it.
The requirements of a reverse mortgage often include being 62 or older, maintaining your property as your primary residence, and having a low balance on your mortgage or having paid it off.
Homeowners who live on a limited income and have a need for additional funds find reverse mortgages ideal for their situation. Social Security and Medicare benefits are not affected; and the money is not taxable. Reverse Mortgages may have adjustable or fixed rates. Your lender can't take away your property if you outlive your loan nor can you be required to sell your home to repay your loan even if the balance is determined to exceed current property value. If you would like to find out more about reverse mortgages, please contact us at (760) 632-7701.
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