Reverse mortgages (sometimes called "home equity conversion loans") give older homeowners the ability to benefit from their built-up home equity without having to sell their home. The lender pays you money based on the equity you've accrued in your home; you receive a one-time amount, a monthly payment or a line of credit. Repayment is not required until after the borrower puts his home up for sale, moves (such as into a care facility) or passes away. You or your estate representative has to repay the reverse mortgage funds, interest accrued, and finance fees after your property is sold, or you are no longer living in it.
The conditions of a reverse mortgage typically are being 62 or older, maintaining your home as your primary living place, and having a low remaining mortgage balance or having paid it off.
Homeowners who are on a limited income and need additional money find reverse mortgages helpful 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 lending institution isn't able to take the property away if you outlive your loan nor can you be made to sell your residence to pay off the loan amount even if the balance is determined to exceed property value. Contact us at 610-565-3600 if you want to explore the benefits of reverse mortgages.