Reverse mortgages (sometimes referred to as "home equity conversion loans") enable older homeowners to tap into built-up equity without having to sell their home. The lender gives you money based on the equity you've accrued in your home; you get a lump sum, a payment every month or a line of credit. The loan does not have to be paid back until the homeowner sells the home, moves out, or passes away. After you sell your property or you no longer use it as your main residence, you (or your estate) have to pay back the lending institution for the funds you got from the reverse mortgage in addition to interest and other fees.
Typically, reverse mortgages require youto be at least sixty-two years old, have a small or zero balance in a mortgage and use the home as your main living place.
Many homeowners who live on a limited income and find themselves needing additional funds find reverse mortgages ideal for their situation. Rates of interest can be fixed or adjustable and the funds are nontaxable and don't affect Medicare or Social Security benefits. Your lender will not take away your home if you live past the loan term nor can you be required to sell your home to repay your loan amount even when the loan balance grows to exceed current property value. Call us at (773) 774-9040 Ext 121 if you want to explore the benefits of reverse mortgages.
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