With a reverse mortgage loan (also referred to as a a home equity conversion loan), homeowners of a certain age may use home equity for anything they need without having to sell their homes. Deciding how you would prefer to be paid: by a monthly payment amount, a line of credit, or a one-time payment, you may receive a loan based on your home equity. The borrowed money doesn't have to be repaid until the homeowner sells the residence, moves out, or passes away. You or an estate representative must pay back the reverse mortgage funds, interest , and finance fees at the time your home is sold, or you can no longer call it your primary residence.
The requirements of a reverse mortgage often include being 62 or older, using the property as your primary living place, and having a small remaining mortgage balance or owning your home outright.
Reverse mortgages are helpful for homeowners who are retired or no longer working but need to supplement their fixed income. Rates of interest can be fixed or adjustable and the funds are nontaxable and don't adversely affect Social Security or Medicare benefits. Your residence is never in danger of being taken away by the lender or put up for sale against your will if you live past the loan term - even if the current property value dips under the balance of the loan. If you'd like to find out more about reverse mortgages, feel free to call us at 703.255-5810.
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