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Reverse mortgages are very flexible - here
you will learn some ways that you may benefit and how they compare with
regular home equity loans.
Things you need to know:
 A
reverse mortgage is a loan against your home (your main residence) that
requires no repayment. They are "non-recourse" loans. In other words,
the amount you owe can never exceed the net selling price of your home.
Loan advances to you are not taxable. They are disbursements of
principal, not income.
If
you die or decide to sell your home, and it turns out that the loan
balance is greater than your home's net selling price, the government
(or the lender such as Fannie Mae) makes up the difference. This is what
"non-recourse" means.
Even with a Reverse Mortgage, you will still own your home. A reverse
mortgage is just a loan. If you sell your home, the loan is repaid and
you or your heirs receive the leftover home equity.
The loan is not due on any specific date and there are no payments. You
can live in your home as long as you wish without repaying the loan (you
still own your home and must keep insurance and property taxes current.)
 A
reverse mortgage is simply a way for you to redeem some of your home's
equity now, without selling it and without creating an extra payment for
yourself.
With a reverse mortgage there are no income requirements to qualify and
much less credit history scrutiny than a home equity loan. (And no
payments to make!)
Home equity loans have a due date when you must pay back the entire loan
balance; reverse mortgages are not due until your home is no longer your
principal residence.
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The
NRMLA Consumer Guide to Reverse Mortgages
NRMLA's first
consumer guide to help educate senior's about reverse mortgages.
Using Reverse Mortgages for Health Care: A NRMLA Guide for Consumers
This guide helps explain how reverse mortgages
can be used to help pay for your health care needs and preserve your
financial security.
Just the FAQs: Answers to Common Questions About Reverse Mortgages
This guide lists the most common questions asked by consumers about reverse mortgages—with the answers from the National Reverse Mortgage Lenders Association. The questions are broken into three groups: those appropriate to ask before getting a reverse mortgage; those applicable during a reverse mortgage; and those applicable at the end of a reverse mortgage.
FannieMae's Money From Home
A detailed guide to understanding reverse mortgages.
AARP's "Home Made Money"
A Consumer's Guide to Reverse Mortgages"
Considering a Reverse Mortgage?
Review these 5
steps to see if a Reverse Mortgage is right for you. |
