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Reverse Mortgage Continues to Increase in Popularity
As the average population of the United States grows older, the reverse mortgage is becoming more popular. When you say the words "reverse mortgage", most people have a negative impression. The common misconception is when you sign a reverse mortgage, the bank takes title to your home and you just live there until you pass away. Wow, that is a negative impression.
The fact is a reverse mortgage allows you to remain the owner of your home and use its equity for cash advances. More and more seniors are using a reverse mortgage to supplement their income or social security, meet unexpected medical expenses, make home improvements, go on vacation, or just keep up with their ever-rising property taxes.
Intrigued? Questions? Well, a reverse mortgage is a loan against your home that you do not have to pay back for as long as you live in that home. To qualify, you need to be 62 years of age or older. The reverse mortgage is different from a traditional mortgage in that it pays you. The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home. Since there are no monthly payments to make, you can't lose your home by not making them. But don't worry, with a reverse mortgage, YOU remain the OWNER of your home. The only payments you must make are your property taxes and homeowners insurance. You can never owe more than what your home is worth at the time the loan is repaid. The lender may not seek repayment from your income, your other assets, or from your heirs. All reverse mortgages are due and payable when the last surviving borrower dies, sells the property, or permanently moves out of the home.
Many people even pay off their current mortgages with the proceeds of the reverse mortgage. So, you can go from making monthly mortgage payments to having cash in your hand. You can receive your reverse mortgage proceeds in several ways: all at once (lump sum); regular monthly advances; credit line advances (you decide when and how much cash you want); or a combination of these payment methods.
Settlement Solutions has been working with reverse mortgage consultants for several years. If you or anyone you know is interested in more information regarding a reverse mortgage, please feel free to give us a call at 610-338-0500 or email settlementsolutions@comcast.net.
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