Reverse mortgages (also called "home equity conversion loans") enable older homeowners to benefit from their built-up home equity without having to sell their home. Choosing between a monthly amount, a line of credit, or a one-time payment, you can receive a loan based on your equity. The loan does not have to be paid back until the homeowner sells his home, moves away, or dies. After your house has been sold or is no longer used as your primary residence, you (or your estate) are obligated to pay back the lending institution for the money you received from the reverse mortgage plus interest and other fees.
The conditions of a reverse mortgage loan generally include being 62 or older, maintaining the property as your primary living place, and having a small remaining mortgage balance or owning your home outright.
Homeowners who are on a fixed income and need additional money find reverse mortgages advantageous for their situation. Social Security and Medicare benefits are not affected; and the money is not taxable. Reverse Mortgages can have adjustable or fixed rates. The home will never be at risk of being taken away from you by the lending institution or sold without your consent if you live longer than the loan term - even if the property value creeps under the balance of the loan. Call us at 610-565-3600 if you'd like to explore the advantages of reverse mortgages.