Entering Into a Reverse Mortgage
Seniors who are at least 62 years old may consider a reverse mortgage to increase personal income during retirement years. Many individuals are approaching this time in their lives with insufficient money to sustain their lifestyle without being gainfully employed. A home that is mortgage free or one that has a small loan balance can be utilized to subsidize elderly homeowners’ finances. Those who are interested in remaining financially independent should consider this option to supplement their income.
Benefits of a Reverse Mortgage
This type of mortgage is based on the amount of equity that has accumulated in the home over years of making house notes. The equity is distributed to the homeowners in a choice of payments that include; monthly checks, a line of credit, or one lump sum. This money may be used at the discretion of the borrowers to pay off debt, remodel the home for senior living, or travel. The reverse mortgage is not classified as a loan and is not considered income; the money is tax free.
Reverse Mortgage Guidelines
Single family homes, condominiums, multi-family units where one unit is occupied by the homeowner, and most mobile homes are approved reverse mortgage structures. Homeowners continue the financial responsibility of paying for property taxes and insurance and routine maintenance. Couples cannot enter into this type of mortgage until both are at least 62 years of age. There are no credit restrictions or income limitations imposed with this senior mortgage agreement. Homeowners may live at their residence for as long as they choose. Many make the decision to leave the home and enter an assisted living residence.
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