What Is A Reverse Mortgage?
I guess many of the people out there understand what is a mortgage but I doubt many will actually know what is a reverse mortgage or reverse mortgage loan. A reverse mortgage is a type of mortgage which allows you to take a portion of your home equity that you have built up and have it as cash. This would be perfect for retirees whom like to supplement their income and helping them to meet ends meet. Also, there will be no worry for you about repaying the loan until you no longer have that particular home as your main residence.
However, you do need to keep in mind that there are certain criteria to meet to get this type of reverse mortgage and should there be something happen to you, your family will be left with the mortgage loan to take care of unless you have made other arrangements for it.
In order to qualify for reverse mortgages, below are generally some requirements.
- You need to have either a single-family home or at least a 2 to 4-unit property which are current residing.
- Your property can be a type of duplex, town home or even a mobile depending on your situation. If you happen to live in a condominium, you need to ensure that it is FHA-approved.
If you have decided to take up a reverse mortgage loan, the next thing you need to make sure of, is to find a reliable reverse mortgage lender that you can trust and know the in and out of it. To start off, you need to speak to a few lenders to find out what are your options. You may wish to check with your personal bank or your original mortgage lender on this too.
Important:
There have been many class action lawsuits that have been filed on behalf of the seniors whom have attempted to utilize reverse mortgage to supplement their income to cover their medical expenses. Lawsuits have been filed against unnecessary fees that have been included which may not even pertain to the reverse mortgage loan itself. Hence it is essential that you know who you are dealing with.
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