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Home Loans Five Reasons to Consider a Reverse Mortgage
Home Loans Five Reasons to Consider a Reverse Mortgage
| Five Reasons to Consider a Reverse Mortgage |
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Not too long ago, there was a story in the news about a single, elderly woman who had owned her own home, but had fallen on hard times. Afraid she would lose her home, she looked into a reverse mortgage information. Her particular story had a very happy ending. Today, with the current recession, most seniors are worried they will not be able to pay bills and remain in their homes. Moreover, medical expenses could wipe out their entire savings. What is a reverse mortgage? Seniors 62 years of age and older can borrow money against the value of the home. Payments are tax free, and the homeowner retains the title to the home until such time as the owner moves or dies. Under the terms of the reverse mortgage interest rates, the loan becomes due when one or more of the following conditions occurs: (a) the last surviving borrower passes away or sells the home; (b) all borrowers permanently move out of the home; (c) the last surviving borrower fails to live in the home for 12 consecutive months; (d) the borrower fails to pay property taxes or hazard insurance; (e) the borrower does not maintain the home in reasonable condition. Here are five reasons why a senior could benefit from having a reverse mortgage: 1. A senior would not have to worry about relying on family members for financial assistance. In essence, they would be financially independent. 2. The senior would not have to leave his or her home for any reason since they retain the title. 3. No longer would a senior have to make a monthly mortgage payment. 4. A reverse mortgage is a tax-free payment and will not affect either their Social Security payments or Medicare benefits. 5. The money received monthly can be used for many different purposes including paying bills, taking a vacation, and enrolling in college courses. Before considering a reverse mortgage, however, it would be prudent to speak with a financial counselor or reverse mortgage calculator to ascertain if this is the appropriate step for each particular situation.
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