Reverse Mortgage for Seniors
Senior homeowners, who are at least 62, are entitled to receive a portion of their equity to fund their retirement, pay off debt, or supplement their income. These monies are paid to the borrowers in one lump sum amount, monthly payments, or through the establishment of a line of credit; the payment option is the homeowners’ choice. The home for consideration in a reverse agreement must be mortgage free or have a minimal mortgage balance. The loan is never repaid to the lender unless the homeowners make the decision to end the agreement and repay the loan amount to include the lender’s service charges.
Reverse Mortgage Responsibilities
The property owners agree to take care of usual repairs and maintenance while in a reverse mortgage agreement. It is their responsibility to also pay for property taxes and insurance, and keep this home as their primary residence. The money paid to the homeowners is considered a loan and is tax free and not reported as income on yearly tax returns. The borrowers may live in their home until the decision is made to choose another living arrangement.
Reverse Mortgage Benefits
Many homeowners find themselves old enough to retire but without adequate means to fund these golden years. A reverse mortgage is available to enable senior citizens to live financially independent in their homes for as long as possible. They do not need to rely on family to pay for additional personal care and medical expenses. Homes can be modified for the senior needs with the reverse agreement money. Mortgage payments will stop and equity payments will continue until the homeowners move.
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