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What is a Reverse Mortgage?

 

There has been a lot of confusion about Reverse Mortgages. Some good, some not so good. Very simply, a Reverse Mortgage is a loan, secured by a home, where monthly payments are deferred to a later date. The loan is repaid when the borrower passes away, leaves the home permanently or sells the house. Funds from the loan are distributed as a lump sum, line of credit or structured monthly payments.

When Can Reverse Mortgages Be Useful?

  • If you are house rich and cash poor, a Reverse Mortgage can provide needed money now.

  • A Reverse Mortgage is a great way to improve the quality of life if you are on a fixed income.

  • As a distribution sequencing strategy, a Reverse Mortgage can preserve your current retirement assets and help your funds last 10-12 years longer.

  • You can even use a Reverse Mortgage to buy your perfect retirement home instead of paying all cash or taking out a traditional mortgage, allowing you to save and invest more of the proceeds from the sale of your current home.
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 What are the basic qualifications of a Reverse Mortgage?

In order to qualify for a Reverse Mortgage, you must:

  • Be 62 years or older.

  • Have significant equity in your home.

  • Use the home as your principal residence.


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Find Out More About a Reverse Mortgage.
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