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Reverse Mortgages Assisting Seniors

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Senior homeowners across the nation are now turning to a new source for cash income: their home.  From helping to pay their property taxes to taking a well deserved vacation or even paying for home healthcare expenses, now more than ever, Reverse Mortgages are providing the means for seniors to improve the quality of their lives.

With a Reverse Mortgage, homeowners at least 62 years in age, are now able to capitalize on the equity they have in their homes to be used as the basis to qualify for a Fannie Mae or FHA type loan.  Unlike traditional home equity loans, this one does not have to be repaid until the homeowner permanently leaves the residence.   A Reverse Mortgage allows seniors to tap into a cash source previously unrealized which helps them pay for anticipated or unexpected expenses.

 The program is based primarily on three factors: the age of the youngest borrower, amount of equity in the home and interest rates.  The older the borrower, the more money they will be able to receive.  Proceeds from the loan can be received in the form of a lump sum, monthly payments, a line of credit or even a combination of monthly payments and line of credit.  The borrower has the luxury to select how they will receive the funds - it all depends upon the nature of the financial need.  However, the most popular form of disbursement is the line of credit.   The reason for the prevalence of
this type of disbursement is because under the Reverse Mortgage program, the line of credit actually increases as the months go by.  Reverse Mortgages can also be utilized to pay off an existing mortgage.  There are also jumbo reverse mortgages now available for those with higher priced homes.  

So what's the catch?  Simply, that there will not be as much equity in the home for the
heirs after the home passes into estate.  However, several seniors have indicated that
because their children have their own homes, this isn't really a great worry to them.  Because the lender can only derive repayment from the property itself, the borrower and heirs have no responsibility for repayment of the loan.  Even if the property is not worth enough to completely pay off the loan, the loans are backed by mortgage insurance, which will pay the difference, if any                                                 

Reverse Mortgages are allowing seniors the opportunity to make the homestead that they have taken care of for so many years, now take care of them in return.  Instead of letting one of their greatest assets go to waste, they are making it work for them.  In summary, these seniors are allowing the reverse mortgage program enable them to take advantage of the good things life has to offer.

Editor’s Note: Senior homeowners interested in receiving additional free information on the program  should contact: Harriet R. McCormack, at  (800) 386-3791 ext. 1739 or at  201-708-1739     You are also invited to visit their web site at www.reversemortgageweb.com