There is a newly popular option out there for seniors to consider when they want to get their hands on money: a reverse mortgage. Contemporary seniors are living longer, meaning their pensions do not go as far as they used to. They have to make ends meet for longer, so they skimp on the things they thought they would do when they were free of professional responsibilities like traveling. A lot of seniors live long enough to need assistance in the home or they have to make changes, like adding a stair lift, ramp, and adapting bathrooms for safety. This all costs money.
With the option to open a reverse mortgage, men and women in their retirement years have discovered funds to take holidays around the world, replace old cars, fix up their homes the way they want them, or to address emergencies. The furnace dies, so an elderly person needs to replace it. His pension is inadequate, so he takes out a reverse mortgage. The benefit is that he not only pays for the furnace but also has money for other things.
Not Easy Money
Reverse mortgage facts make it clear that this is not easy money, even though it seems like that at first. There are a number of fees to pay, although they can be absorbed into the end costs. These are satisfied with the sale of a home at which time a loan is repaid all at once to the lender.
Meet a Counselor
It is also important that seniors not feel pushed to make a decision for a reverse mortgage because of the need for money in a hurry. The process cannot be rushed. In fact, the U.S. government insists consumers meet with a counselor before signing up, so there is no way to get an application accepted in just 24 hours.
Even if you are a senior aged 62 or beyond, this program is only available under certain circumstances. Here are some more reverse mortgage facts:
• You have to be the owner of the home, with no remaining mortgage payments to make
• This has to be the home you live in all or most of the time
• It has to be big enough to qualify (that is, more than 1 bedroom)
• Some condos and modular homes qualify, but not all
If you are approaching the age of 62 and the idea of release equity to enhance quality of life sounds appealing, there are several unbiased online resources.
See also our Free Reverse Mortgage Facts Brochure for download.