Who are reverse mortgages designed for? Stay in your home and cash in on the equity with a reverse mortgage!! Find out here if you qualify!
A reverse mortgage is a reverse loan from a mortgage lender which pays either a lump sum payment or monthly payment to a homeowner. The reverse mortgage balance is paid back upon the homeowner’s death through proceeds of the home’s sale. Reverse mortgages are a great way for individuals to tap into their home’s equity without having to sell and move out of their homes. This article discusses who reverse mortgages are designed for.
Retired Individuals
Reverse mortgages are largely designed for retired individuals. Reverse mortgage require an individual to be at least 62 years old. While reverse mortgages don’t necessarily require an individual to be retired, they do charge fees that make opening reverse mortgages unattractive for anyone who has another stream of income. Also, the funds available to someone who desires a reverse mortgage increases with age. For example, someone who is 82 years old will be approved for a larger reverse mortgage than someone who is 62.
Homeowner with Equity
Reverse mortgages are also designed for individuals who have equity in their homes. The reverse mortgage borrower doesn’t necessarily need to have their home paid off in full, but to capitalize on the maximum amount of funds available, the more equity they have in their homes, the more of a reverse mortgage payout they will receive.
People Who Plan to Stay in their Homes
Reverse mortgages are also designed for individuals who want to stay in their homes. Due to the upfront fees associated with reverse mortgages, it does not make economic sense to take out a reverse mortgage if an individual only plans to stay in their home for a few years.
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