The U.S. Department of Housing and Urban Development put out a nice "Top 10 things to know" list about reverse mortgages. I have included it here in the hopes that you find it useful. http://www.hud.gov/offices/hsg/sfh/hecm/rmtopten.cfm
The following link will take you to the main page of the HUD.GOV website for REVERSE MORTGAGES and I am not responsible for the content, nor did I write any of the content on the HUD.GOV website. http://www.hud.gov/buying/rvrsmort.cfm
If you find it useful, please let me know. If I can provide any additional information, please email or post your questions here.
6/24/2009
Reverse Mortgages - An Overview
Reverse Mortgages could be the best tool available to someone over the age of 62 to access the equity in their home. There are several reasons for this:
1) No monthly payments are required - ever.
2) There is no income or job requirement for the borrower
3) Credit is not important and the homeowner can even be in foreclosure
4) Fixed rates as low as 5.56% are available (as of June 2009).
The amount a homeowner can borrow depends on the age of the youngest person on the loan (between the husband and wife), the current interest rate, and the value of the home. As a general rule of thumb, take the age of the homeowner and subtract 5 and you will get the approximate amount of equity available to take as cash or to set up as a line of credit.
Example: An individual who is 80 years young, could access 75% of her home's equity. If her home is worth, $200,000, she can obtain cash in the amount of $150,000 or potentially open a line of credit with an initial limit of $150,000.
Did you know? The government offers a type of reverse mortgage called the HECM (Home Equity Conversion Mortgage) which is insured by the FHA and guarantees that you and/or your heirs can never owe more than your home is worth. Talk about SAFE!
Summary of this blog: Reverse mortgages come with attractive fixed rates and the insurance on a reverse mortgage protects your family estate from ever owing more than your home is worth.
Note: Many people will say they can assist you in obtaining a reverse mortgage, but please be sure the individual is trustworthy, well educated and experienced in completing reverse mortgages, and working in your best interest in mind.
More to come...please contact me with questions.
1) No monthly payments are required - ever.
2) There is no income or job requirement for the borrower
3) Credit is not important and the homeowner can even be in foreclosure
4) Fixed rates as low as 5.56% are available (as of June 2009).
The amount a homeowner can borrow depends on the age of the youngest person on the loan (between the husband and wife), the current interest rate, and the value of the home. As a general rule of thumb, take the age of the homeowner and subtract 5 and you will get the approximate amount of equity available to take as cash or to set up as a line of credit.
Example: An individual who is 80 years young, could access 75% of her home's equity. If her home is worth, $200,000, she can obtain cash in the amount of $150,000 or potentially open a line of credit with an initial limit of $150,000.
Did you know? The government offers a type of reverse mortgage called the HECM (Home Equity Conversion Mortgage) which is insured by the FHA and guarantees that you and/or your heirs can never owe more than your home is worth. Talk about SAFE!
Summary of this blog: Reverse mortgages come with attractive fixed rates and the insurance on a reverse mortgage protects your family estate from ever owing more than your home is worth.
Note: Many people will say they can assist you in obtaining a reverse mortgage, but please be sure the individual is trustworthy, well educated and experienced in completing reverse mortgages, and working in your best interest in mind.
More to come...please contact me with questions.
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