With a reverse mortgage (sometimes referred to as a a home equity conversion loan), homeowners of a certain age may use home equity for anything they need without selling their homes. The lending institution pays you funds determined by the equity you've built-up in your home; you get a lump sum, a monthly payment or a line of credit. The borrowed money does not have to be repaid until the borrower sells the home, moves out, or dies. After your house sells or is no longer used as your primary residence, you (or your estate) are obligated to pay back the lender for the funds you received from the reverse mortgage plus interest among other fees.
Usually, reverse mortgages are offered to borrowers at least 62 years of age, have a small or zero balance owed against your home and use the home as your principal living place.
Reverse mortgages are great for retired homeowners or those who are no longer bringing home a paycheck and have a need to supplement their limited income. Interest rates can be fixed or adjustable and the money is nontaxable and doesn't adversely affect Social Security or Medicare benefits. The residence will never be at risk of being taken away from you by the lender or sold without your consent if you outlive your loan term - even if the current property value dips under the balance of the loan. Contact us at (773) 774-9040 Ext 121 to discuss your reverse mortgage options.
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