How Do Reverse Mortgages Work

How Do Reverse Mortgages Work? – The Ultimate Guide

How do reverse mortgages work?If you’re getting near retirement age you may have come across this financial product. Just about everyone asks the same question, just how do reverse mortgages work? They continue to grow in popularity and the basics are relatively simple.

A reverse mortgage is designed for senior adults getting near retirement or already retired. Its similar to a conventional mortgage in one respect – it allows you to borrow against the equity that you have in your personal residence.

However, unlike a traditional mortgage where you are required to make monthly payments of principal and interest to repay the loan, with a reverse mortgage, you don’t. As long as you live in the home, none of the mortgages has to be repaid. Not until you sell the home, or it is no longer your personal residence, or the last borrower dies, is the loan repaid.

This program is administered by the FHA and does have certain conditions that must be met.

From a financial perspective, how do reverse mortgages work?

A reverse mortgage does differ from a conventional mortgage or a home equity loan. The latter two View full post…

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What is a Reverse Mortgage

What is a Reverse Mortgage – Pros and Cons

What is a reverse mortgageIf you were to ask the question, what is a reverse mortgage, to the average citizen, you would hear a number of different answers, many of them incorrect. The reverse mortgage program was initially designed to assist senior citizens who primarily were “house rich and cash poor”.

This would be done by providing them funds to meet their living expenses and remain in their homes. They would be able to borrow against the equity in the home and not have to repay it until they either sold the home, moved away, or died.

Practically from the very beginning, the program was rife with problems due primarily from confusion with the borrowers because no one took the time to answer the question, what is a reverse mortgage? View full post…

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