A reverse mortgage makes it possible for homeowners 62 or older to convert their home equity into a home loan with deferred payments. In most cases, those payments can be deferred for as long as the homeowner either remains living in the home as their primary residence or defaults on certain obligations such as taxes or insurance. Reverse mortgages can also provide qualifying homeowners with tax-free loan proceeds which is typically used to make retirement more enjoyable, finance housing improvements, or to permit retirees to remain in their own home throughout their retirement so long as the borrower pays property taxes, homeowners insurance and costs associated with home maintenance.
The main requirements that a reverse mortgage imposes is that the homeowner must remain current with all property taxes and insurance and handle all critical maintenance on the home. As long as those conditions are met, there are no minimum mortgage payments that must be made until either the borrowers pass away or move from their primary residence.
Interest compounds throughout the period of the reverse mortgage, but in most cases, the borrower (or the borrower’s estate) will not be required to repay any amount on the loan that exceeds the value of the house. Reverse mortgage lenders are also obligated by law to refer potential borrowers to unbiased loan counselors to determine whether or not this type of loan is right for person’s individual situation.
When you are ready to speak with an experienced Tucson reverse mortgage solutions specialist and if you want to get more answers to your question “What is a reverse mortgage?”, give Sandy McKee of Altitude Home Loans a call.
What a Reverse Mortgage Can Do for Your Retirement
There are several reasons why seniors decide to work with a reverse mortgage lender:
- They want to enjoy their retirement
- It can help to make expensive medical care more affordable
- The loan can cover living expenses without requiring either borrowing high-interest debt, selling the house, or leaning on family for support
- A reverse mortgage can help seniors under financial stress restore their savings and pay off higher-interest loans with burdensome monthly payments
- Reverse mortgages can help with expenses like paying taxes and funding home improvements and repairs
- A reverse mortgage allows for fun expenses like taking a vacation
- The loan can be a useful tool for estate planning – for example, it may make it possible for a retired couple to hold on to a stock portfolio for longer to realize larger returns
- It can make it easier for retirees to help grandchildren and other younger relatives to pay for education and other significant expenses
For more information about how reverse mortgages work and to see some myths about them busted, check out our page on the topic.
What Types of Payments are Available for Your Reverse Mortgage
When it comes to receiving payment for your Tucson reverse mortgage, the terms are flexible. Borrowers can elect to receive the reverse mortgage payment in a lump sum, in monthly payments for a set term, in the form of a line of credit, for the entire period of when the borrower lives in the home, for a specific period of time, or a flexible combination of all these methods.
Will I Qualify for a Reverse Mortgage?
There are several important requirements that the borrower must meet to qualify for a reverse mortgage in Tucson:
- You must be 62 years old or older
- You must own and live in your own home
- The home under consideration for the reverse mortgage must be your primary residence
- You must pass a credit, asset, and income check much like any other mortgage
To review how much money you could get, use our reverse mortgage calculator today. You can also contact Sandy McKee of Altitude Home Loans in Tucson, AZ online or by phone to discover more about reverse mortgage solutions for your specific situation or to get answers to your questions like “What is a reverse mortgage?” and “Do I quality?”.