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A reverse mortgage (also known as a Home Equity Conversion Mortgage, or HECM) allows homeowners to convert the equity in their home into cash. While there are misconceptions about how reverse mortgages work, they are useful financial tools when used in the right situation. Here are some commonly asked questions about reverse mortgages:
A reverse mortgage is a way for seniors to get cash from their home without having to sell it. But many people get confused about what a reverse mortgage is and how it can help them. The short answer is that many folks who own their home and are over the age of 62 have equity in their home. A reverse mortgage allows you to use that equity in monthly payments to you instead of you making monthly payments to a bank or lender!
If you’re 62 years old or older, a reverse mortgage could be your solution to paying off outstanding bills, investing in yourself, or just enjoying time traveling with the people you love most. You don't have to be limited by a fixed income if you unlock the power of the equity within your home. But how do you know if it’s right for you? We encourage you to take the time to check out some of the information here on our website, but also, don't be afraid to pick up the phone to talk to us! We are local and welcome the opportunity to walk you through your reverse mortgage options.
You can use the funds from a reverse mortgage for any purpose—medical care, home improvement projects, debt reduction, travel—and there are no restrictions on how you spend the money. For all intents and purposes, the funds are yours to do with what you want. For folks on a fixed income, a reverse mortgage can open the doors for them to do the things they’ve always dreamed of, like traveling the world, or simply finding the relief of not having to worry about bills.
The short answer is no, a reverse mortgage doesn’t cost you anything. However, in addition to loan origination fees and upfront costs, there are several ongoing costs associated with having a reverse mortgage. These include (but aren’t limited to) property taxes, utilities, and homeowner association fees which you’d normally pay anyway with a regular mortgage.
A reverse mortgage can last for the rest of your life so long as you fulfill your obligation to stay current on homeowners insurance, pay your taxes, and keep the home in good condition.
At the minimum, you must be 62 years old and meet some additional requirements. The easiest way to get this answer based on your individual situation is to just give us a call and we can look at your options!
