In these times of economic uncertainty, it is important for every citizen of these United States of America to understand they have options. Healthcare costs have increased, the cost for a bag of groceries is ever growing, and gasoline prices continue to be a pain for anyone on a fixed income.
Whether because of credit history, age, or other circumstance, there are often not many options open to people when they are in need of a reliable source of extra money. Eligibility for government assistance programs is dubious at the best of times. Borrowing money from family members is a trying experience at best. However, looking into reverse mortgage for seniors can often be the lifesaver America’s seniors are looking for.
What is a Reverse Mortgage?
A reverse mortgage is a loan given to seniors that releases the equity in their home into one lump sum payment or multiple installments. Learning how reverse mortgage works is crucial to the success and understanding of anyone considering a reverse mortgage. Here are four pieces of important reverse mortgage info to help the process along.
- Age Does Matter
- Credit Checks Are Usually Unnecessary
- Debt is Controlled
- When Does the Debt Need to Be Repaid?
Any home owner over the age of 62 is eligible to apply for a reverse mortgage in the United States. Because of reverse mortgage rules, the older the reverse mortgage applicant is, the larger loan amount they are able to receive. For example, a 70 year old reverse mortgage applicant will receive a larger loan than their 62 year old counterpart.
One of the most interesting pieces of reverse mortgage info is the fact that most individuals applying for this type of loan do not need to undergo a credit check, making it a great option for elderly home owners with less than stellar credit scores. While that does not guarantee a successful application, it certainly does not hinder the process.
Reverse mortgages can be taken out in one lump sum, through a line of credit, or through monthly payments, depending on the case. However, regardless of how homeowners choose to receive their reverse mortgage payments, the debt accrued through this process will never exceed the equity value of the home. In short, homeowners will never owe more than can be paid back through the value of the home and its contents.
A truly important piece of reverse mortgage info is knowing when the loan needs to be repaid. Upon the last person leaving the reverse mortgaged home, the debt is due in full. This means homeowners can enjoy the benefits of a reverse mortgage until they leave their home. No payments are due until that time.
American seniors who are in need of financial assistance who also own homes should keep this reverse mortgage information in mind . Doing so can help them to find a much better arrangement than borrowing money elsewhere.