When Is A Reverse Mortgage Right for Me?
One of the most important benefits of the reverse mortgage is the peace of mind it brings. By having access to money at any time, it allows people to maintain their financial independence and not have to rely on their children for help. But is it right for you? Do you qualify?
- You are committed to staying in your home, either because you don’t want to leave or because other housing alternatives are unappealing or unaffordable.
- You want to enhance your lifestyle and enjoy your golden years.
- You want to maintain your financial independence and peace of mind.
- You want a cushion for major expenses such as medical bills for a serious or long-term condition, or for major home repairs or modifications
- You have a regular need for additional income to live on and your only significant asset is your home.
- You want the security that comes from knowing your financial needs are taken care of.
- You need to save your home from foreclosure or have other emergency needs.
- You wish to buy another home and use a reverse mortgage to help finance the purchase
- You need to pay for a caregiver
- You want to help pay for college education for grandchildren.
- You want to purchase life insurance or long term care insurance.
- You want to have money for travel you have been planning.
- You want to help provide financial support for family members.
Why a reverse mortgage can be a good financial option:
- You stay in your home for as long as you live, never making a mortgage payment with the ability to access funds from the equity in your home.
- Receive tax-free funds that will not compromise your Social Security or Medicare benefits
- Allows you to retain your current assets or investment portfolio undisturbed
- You maintain ownership and control of your home including choice of your heirs
- You have a ready source of available funds that can be adjusted to meet varying circumstances and goals.
Important Things to Do Before You make a Decision
Speak with a mortgage professional about financing choices available to you. Be prepared to answer questions like how long you expect to stay in your home, what is your monthly income and expenses, what are your assets. Be able to tell your loan officer what you want to accomplish. Do you want money on a monthly basis, do you want money available only when needed, or are you interested in using all the money immediately. Reverse Mortgages are a long term solution – if you are staying less than 2-3 years other options may be better.
Compare the benefits of each option and determine which best meets your needs. Depending on the answers to the questions, your loan professional can help you decide if a Reverse Mortgage is the right choice for you. Decide is you want to include your family and or financial consultants in the decision making process. Counseling by a HUD approved counselor is required in order to take a reverse mortgage.
Some Important Questions to Ask
- How much money do I need? Is it possible that just paying off the mortgage will provide enough of an additional cash flow?
- How much can I borrow with a Reverse Mortgage and what is the best product for me?
- When does the loan have to be paid?
- Will the loan become due or payable if I go to long term care or a nursing home?
- What will my heirs or I have left after the loan is paid off?
- Are there any early repayment penalties?
- What are my obligations under the Reverse Mortgage such as property mainteneance, property taxes and insurance?
- What if the loans on the house are higher than the home’s value when the loan becomes due?
- Does the lender take my home after I die?
If you want to find out if you qualify and how much you could borrow, please fill out the brief form below.