Reverse Mortgages – What you should know
Probably you have the idea what reverse mortgage is. In very simple words it is an opportunity of getting a periodic income from you home. Here, you pledge your home to a reverse mortgage company and you get an amount after a constant interval. We will see the finer prints of it here.
How much money can you get
Te amount you can get from reverse mortgage will depend on several factors. These factors are your age, your home equity, value of your home, prevailing interest rate, payment option et cetera.
Do you need to give your home to the bank
You do not need to give you home to the bank. You can stay till you live. What if your money and the payment period are over? Then also you can live in your house till you or your spouse live. After that your children can repay the loan and get the home back or they can simply hand over the house to the bank.
When do you need to repay
When you move out of the house permanently or if you pass it to your estate, then you need to repay.
How much will money to be paid by your heirs
The total amount to be paid will be calculated using the amount you borrowed, the interest, service fees, other fees, and costs. Some of the fees that you will need to pay are an origination fee, standard closing costs, and an appraisal fee.
Many people think that reverse mortgage may hamper their social security and other benefit eligibility. That’s wrong. A reverse mortgage will not hamper your Social Security or Medicare benefits. In some cases it may affect some of the benefits like the federal Supplemental Security Income program benefit or state-run programs like Medicaid benefit. So, ask a professional expert to find out it before you apply for reverse mortgage.
