What is a Reverse Mortgage?
A reverse mortgage is a type of loan that enables the home owner to easily convert equity from his/her subject home into available cash which can be used to assist with any present financial obligations. With a reverse mortgage, the home owner does not have to make monthly payments on their current mortgage. In a sense, the mortgage payments are put on hold, but any interest from not paying is added to the overall mortgage balance.
What are some of the requirements?
Must be 62 years of age to be eligible
Must live in the home you are taking the reverse mortgage on
Attend counseling to fully understand what happens with reverse mortgage
Important things to know!
When does the loan come due?
Loan comes due once the borrower dies, sells the house, or fails to keep up with taxes or insurance
What happens when loan comes due?
The borrower or heirs of the property have the option to refinance and keep property, sell the home, or turn home over to lender. You may be able to ask for an extension once loan become due.