If you are like most seniors today, you’ve spent years building up equity in your home (or have even paid it off completely) and would like to put some or all of it to good use. A reverse mortgage may be able to help you do just that.
Maybe you’d like to cover your grandkids’ college educations, pay for long-term health care insurance or hire the help you need to stay in your home when there are no alternatives, or even use the equity to get out of foreclosure.
A reverse mortgage is a federally-insured mortgage that is only available to homeowners 62 years of age or older. It allows them to borrow against their home’s equity, while still maintaining ownership of the home.
Call the Core Mortgage Team today at (855) 554-CORE or (239) 431-5889 to find out if you qualify for a Reverse Mortgage, and to learn more about the pros and cons of the program.
Instead of making monthly mortgage payments and increasing the equity in your home, the reverse mortgage lender makes payments to you either through a lump sum, monthly payments, or a line of credit, and your equity may shrink. The reverse mortgage is repaid when you pass away, permanently move out of the home, or the property is sold.
The Core Mortgage Team specializes in reverse mortgages in Florida, and our licensed loan originators understand their complexities. We can help you understand the costs and features of different types of reverse mortgages, and evaluate the pros and cons of these loans for your situation.
Myths and Facts About Reverse Mortgages
Also known as Home Equity Conversion Mortgages (HECMs), reverse mortgages have become increasingly popular in recent years. They can be a useful financial tool for older homeowners, but the myriad of TV and print advertisements often give us too much information to digest, leading to misconceptions and poor decisions.
Here are a few of the most common myths and facts about reverse mortgages.
- Myth – A reverse mortgage means you have to give up the title to your home.
Wrong; a reverse mortgage is simply a lien against your property. You will continue to retain ownership of your home until you either pass away, no longer live in the home as your principal residence, or fail to pay your property taxes and insurance and maintain the home in good repair.
- Myth – You won’t qualify for a reverse mortgage if you currently have a conventional mortgage.
This is true; however, you can still qualify for a reverse mortgage if you use the proceeds to pay off the balance of your conventional mortgage at closing.
- Myth – You need good credit for a reverse mortgage.
A reverse mortgage is based only on your home’s equity and age. Your income and credit are not qualifying factors. Seniors with all different credit ratings and income levels decide that a reverse mortgage is right for them every day.
- Myth – Reverse mortgages are too expensive.
Taking out ANY mortgage can be costly when you consider loan origination fees, fees for appraisals and title searches, recording costs, and servicing fees, but the majority of these fees can be financed into the loan. When you select a standard reverse mortgage, you will also have to pay an upfront mortgage insurance premium. Another factor to consider is that you (or your heirs) will never have to repay more than the value of your home, even if the amount owed is more that its appraised value.
- Myth – A reverse mortgage can cause you to be forced out of your home.
The reverse mortgage was created specifically to allow seniors to live in their homes for the rest of their lives. Because you will typically be receiving payments instead of making payments to a lender, you can never be evicted or foreclosed on for non-payment.
As with anything else in life, there are unscrupulous people who take advantage of consumers every day. The goal of the Core Mortgage Team is to help you make the most out of your retirement. We can help you decide which reverse mortgage program will work best for your situation.
We are dedicated to meeting the home financing needs of all Florida home buyers. Call us 24/7 at (855) 554-CORE or (239) 431-5889 to find out more about reverse mortgages, or drop in for a visit at our Naples, Florida headquarters!
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