With a reverse mortgage loan (also called a home equity conversion loan), homeowners of a certain age may use home equity for living expenses without having to sell their homes. The lender pays out money determined by the equity you've built-up in your home; you receive a one-time amount, a payment every month or a line of credit. Repayment isn't required until when the homeowner puts his home up for sale, moves (such as into a retirement community) or passes away. You or representative of your estate must repay the reverse mortgage funds, interest , and finance charges after your home is sold, or you can no longer use it as your primary residence.
Most reverse mortgages are available for borrowers at least sixty-two years old, have a small or zero balance owed against your home and use the home as your principal residence.
Homeowners who are on a fixed income and find themselves needing additional funds find reverse mortgages helpful for their situation. Social Security and Medicare benefits can not be affected; and the funds are not taxable. Reverse Mortgages can have adjustable or fixed interest rates. Your residence is never at risk of being taken away from you by the lender or sold against your will if you outlive the loan term - even if the property value dips below the balance of the loan. If you'd like to learn more about reverse mortgages, feel free to call us at 562 320-0510.
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