Reverse mortgages (sometimes referred to as "home equity conversion loans") enable older homeowners to tap into home equity without the necessity of selling their home. The lending institution pays you money determined by the equity you've built-up in your home; you receive a one-time amount, a payment each month or a line of credit. Repayment isn't required until the homeowner sells the property, moves (such as into a retirement community) or passes away. At the time you sell your home or is no longer used as your primary residence, you (or your estate) have to pay back the lending institution for the funds you received from your reverse mortgage in addition to interest and other fees.
The requirements of a reverse mortgage loan typically are being 62 or older, maintaining your house as your primary living place, and having a low remaining mortgage balance or having paid it off.
Many homeowners who live on a fixed income and find themselves needing additional money find reverse mortgages ideal for their situation. Rates of interest can be fixed or adjustable while the funds are nontaxable and do not affect Social Security or Medicare benefits. Your lending institution is not able to take away your property if you outlive your loan nor will you be required to sell your residence to repay the loan amount even when the balance grows to exceed current property value. Call us at (973) 601-2122 if you would like to explore the benefits of reverse mortgages.
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