How Do I Determine Which Reverse Mortgage Is Right For Me?

How do I determine which reverse mortgage is right for me? Should I seek counseling prior to getting a reverse mortgage? Can I cancel a reverse mortgage?

When you apply for a reverse mortgage there are a few things that you must look at prior to committing to the contract. First, what is the cost of the loan when it comes to maintenance fees and interest rates. Second, do you want a lump sum payment or a monthly payout in the form of a line of credit. Finally, do you want a federally insured reverse mortgage or do you choose a private lender. All lenders have guidelines that they must adhere to when charging fees and interest rates. Shopping around will allow you to find the ones offering the lowest rates. If you choose a lump sum payout, you will be able to get a fixed interest rate. If you want a line of credit, you will have a variable interest rate, but it will only be charged on the portion that has been used. Federally insured reverse mortgages are the only guarantee that your debt will be covered once the home is sold. However, these insurance policies are not cheap and have a yearly premium.

Should I receive counseling prior to getting a reverse mortgage?

All applicants that wish to get a reverse mortgage must go to HUD approved counseling prior to applying for a reverse mortgage. Because the reverse mortgage program involves many different issues, borrowers must be fully educated on the subject prior to approval.

Can I cancel a reverse mortgage?

You have 3 days after signing a reverse mortgage contract to change your mind and stop the process. If you have already drawn funds from your reverse mortgage you still are able to cancel the loan. You will be required to pay back all monies borrowed plus interest and any outstanding fees that are due. Once the debt is covered the account will be closed.

Related posts:

1. How Do I Determine If I Will Get Enough Cash From A Reverse Mortgage?
2. How Do I Determine The Value Of A Reverse Mortgage?
3. How Does The Lender Determine The Max I Get With A Reverse Mortgage?
4. How Does The Credit Line Growth Feature Work On A Reverse Mortgage?
5. Are Reverse Mortgage Rates Fixed or Variable?

This entry was posted on Friday, March 12th, 2010 at 1:18 pm and is filed under reverse mortgage. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.