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Monday, April 14, 2014

The True Facts About Reverse Mortgages

Reverse Mortgage Facts Borrower(s) need to be at least 62 years old. The lender or bank does NOT own the home. A reverse mortgage can be used to purchase a home. There are no income or credit score requirements to qualify for the interest rate. No monthly mortgage payments are required. The home does not have to be free and clear or have a lot of equity. There is no limitation on how the funds can be used. Funds can be received in monthly payments structured as needed, line of credit (with a growth rate), lump sum, or a combination of these. Social Security and Medicare are not affected because it is a loan, and not considered income. Borrowers can stay in the home as long as it is their primary residence. At the time of sale if the home is sold for more than the loan balance, the borrower(s) or their heirs receive the difference, not the bank. The loan is non-recourse which means there is no personal liability to the borrower or their heirs. Borrowers are responsible for property taxes and insurance, association dues (if applicable). As borrowers use the funds/equity and are not making monthly payments the loan balance increases (interest bearing). Closing costs are comparable to a conventional mortgage. FHA offers and insures reverse mortgages through HUD making it the most highly regulated mortgage available. If you have any questions please contact me. I am able to complete a breakdown for review very quickly. Your referrals are greatly appreciated!!! Bob McCormick, President www.mccormicklendinggroup.com