Understanding Reverse Mortgage Loan Options
In today’s ever-expanding real estate market, it can be difficult to sift through all the various loan options available to home buyers.
When you consider things like second mortgages, specialty programs, state bond programs, and demographic-specific loans, among others, it’s easy to become befuddled by the sheer variety of home loan programs.
At Options Financial, we’re committed to helping you borrow with confidence; we want you to rest easy knowing that you have acquired a loan best suited to your unique position as a buyer, no matter what stage in life you may find yourself. And for some buyers, the best option worth considering is a reverse mortgage.
Do You Qualify for a Reverse Mortgage?
Before we dive too deep into a greater understanding of the benefits of a reverse mortgage, it’s important to understand who is actually eligible for this special kind of home loan.
For starters, any homeowner aged 62 years or older can leverage the reverse mortgage tool as a useful way to purchase or refinance a home, or to make a lifestyle change.
It’s worth noting that all borrowers who are listed on the home title must meet the 62 year-age threshold. If one spouse is below this age, there may be added steps to take in order to qualify for a reverse mortgage.
But if you’re entering your much-anticipated retirement years and enjoying a senior lifestyle, considering the many benefits of a reverse mortgage could be a wise choice.
Understanding the Logistics of a Reverse Mortgage
A reverse mortgage can benefits seniors by allowing them to borrow a sum of money that correlates to the value of their home. Even more specifically, the amount of proceeds a borrower can receive from a reverse mortgage is impacted by factors beyond home value, including a borrower’s age, interest rates, and some of the upfront costs.
Designed to help seniors with limited income apply equity towards the cost of living during the Golden Years, a reverse mortgage stands as a practical tool with the potential for several open-ended applications.
With a reverse mortgage loan program, retirees and senior borrowers can forego making monthly mortgage payments. Instead, this type of home loan enables borrowers to receive cash payments that are taken from the available equity in their home.
While the outstanding principle owed on a home increases, the borrower will not be held liable for owing any more on the house than its current market value.
Reaping the Benefits of a Reverse Mortgage
The benefits of reverse mortgage are strong, though the program may not be a great fit for all borrowers. With a reverse mortgage, borrowers are not required to immediately pay back debt; instead, borrowers can defer home payments until they vacate the home, or pass away.
When used as a part of an intelligent, comprehensive financial plan, a reverse mortgage may allow seniors to enjoy the perks of retirement freely and in a way that matches their ideal lifestyles.
True, reverse mortgages are traditionally used to cover added healthcare expenses or standard costs of living, but a reverse mortgage does not stipulate how the proceeds must be spent. Yearning for some extra money so you can travel the world? Searching for additional funds to invest in a grandchild’s future college education?
If any of these practical needs or lifestyle choices resonate with you, then it may be worth it to consider applying for a reverse mortgage today. When you’re ready to learn more, get in touch with Options Financial today.