Reverse Mortgage Benefits
“What is a reverse mortgage?” is a question often asked by many retirees. Briefly, a reverse mortgage is a loan type that allows homeowners to convert their home equity into cash. It is bestowed to senior citizens aged 62 and older who own their place of residence. Reverse mortgages offer a number of benefits to seniors and can be an important tool when planning for retirement.
- No Payment of Monthly Mortgage: Homeowners can use a reverse mortgage to eliminate monthly mortgage payments. They are only required to pay for their homeowners insurance, property tax, and house maintenance.
- Tax Free Money: Unlike other types of loans, the money derived from reverse mortgage is tax-free.
- Retain Home Ownership: You do not need to surrender the title to your house. You can continue living in your residence without the fear of being evicted.
- Reverse Mortgages are Federally Insured: Reverse mortgages are a government-sanctioned program to allow older citizens to get funds from their home while retaining ownership at the same time. This means reverse mortgages are regulated and you are protected by federal guidelines.
- Save Your Social Security Benefits: With the funds received from reverse mortgage, you can save your pension and other social security benefits to collect later.
- No Passing of Debt Obligations to Heirs: Lenders cannot go after your heirs should your house sell for less than the amount that you borrowed.
- Your Income does not Determine the Amount that You will Receive: Unlike other loans, which are income-dependent, how much you will receive from reverse mortgage is based on the current equity of your house.
- Fund Your Retirement: A reverse mortgage gives you extra money to spend on your retirement. You can supplement your retirement income with monthly payments and make retirement savings last longer.
- Support Aging-in-Place Expenses: A reverse mortgage can be used to get the money you need to remain in your home as you age. For example, money can be used for expenses like caregiving and home modifications without the need to transfer to an elderly home facility.
- Protect yourself Financially: A reverse mortgage can be used to create a “standby” line of credit to preserve investment accounts during market downturns or build a safety net that you can use for unexpected expenses, emergencies, or home repairs.
Reverse Mortgage FAQs
To sign up for a reverse mortgage is a big leap forward, especially if you are not familiar with the mechanics of a reverse mortgage loan. Our goal is to provide you with all of the relevant information you need to help you make an informed decision.
- What is a reverse mortgage?
- Does the bank own my home if I take a reverse mortgage loan?
- What if the loan amount ends up more than the value of my home?
- How does a reverse mortgage work?
- What are the reverse mortgage qualifications?
- Will a reverse mortgage affect my Social Security, Medicare, or pension benefits?
Learn More Info on Reverse Mortgages
After years of working to secure your future, it is only appropriate that you enjoy the fruits of your labor when you reach retirement age. A reverse mortgage gives you financial flexibility when you are ready to retire. It gives you an extra fund that you can use any way you want or need without expending your other retirement benefits and savings. For example:
- You can use reverse mortgage as a “rainy day” account to provide additional financial security should unexpected expenses occur.
- You can receive it as a lump sum amount or monthly payment to supplement retirement income.
- It can be a line of credit that you can use any time and for whatever purpose.
The reverse mortgage process does not have to be a complicated one. Advantage Home Loans Corporation is here to help you get the best reverse mortgage loan available to you. Our representatives are always ready to help answer your questions. So if you find yourself thinking “What is a reverse mortgage and how can it help me?”, then send us an email or call us directly and we will tell you everything you need to know about reverse mortgages and how they can make a big difference in your financial future.