Reverse Mortgages

Reverse mortgages are a hot topic in the real estate market today, and one can see why when you understand the reverse mortgage rules. Determining who can qualify for one is somewhat easy. The adage of age before beauty is the golden key to this type of mortgage. Don't get me wrong there are plenty of seniors who have carried their beauty with them, but the financial institutions look at age as the main qualifying factor.

Older individuals who own their own home are usually able to obtain security for a loan. This also applies to those who not married as, no where in the rules is being married a requirement to obtain one. Borrowing on the value of their home is one way that senior's may acquire added cash during this juncture of their life.  This type of mortgage can offer the ability to stay in their cherished home without depleting the hard earned savings. Their home equity can be a source of added cash flow so other financial needs or wants can be addressed. This is one of the have your cake and eat it too advantages of the reverse mortgage.

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This is a major course of action to obtain a loan leveraging your homes equity. As long as you dwell in your home sweet home, no repayment has to take place in a reverse mortgage loan. As borrowers you can get some tax free cash for your home equity because it is considered a loan not an income source. And you will not be owing more than the appraised value of your home.

Did you know that the federal government regulates reverse mortgages, and sets the limit financial institutions are allowed to lend you. It is a comforting thought to know that the lenders are  rigorously regulated by the government, in fact they themselves often offer the lowest cost ones.

It is also advised to take into account some of the reverse mortgage rules before you jump in. To begin with it must be the in the primary lien position, therefore all prior liens and loans must already be paid. As a borrower you have some nice choices available in the way you receive these funds. You may decide that having the entire lump sum is the best course of action for your needs, or perhaps you would prefer to have it set as a monthly income source for a set term as long as you reside in your home.  Another option one may want is to have a line of credit established.  A creative combination of the three could also be available for those who chose to go this route. Or you may want to read about bi-weekly mortgages.