With a reverse mortgage (sometimes called a home equity conversion loan), borrowers of a certain age may use home equity for living expenses without having to sell their homes. Choosing between a monthly payment, a line of credit, or a one-time payment, you can take out a loan amount determined by your equity. Repayment is not required until after the borrower sells the property, moves (such as into a retirement community) or passes away. When your home has been sold or you no longer use it as your primary residence, you (or your estate) are required to repay the lender for the money you obtained from the reverse mortgage plus interest and other fees.
Typically, reverse mortgages are offered to homeowners who are at least 62 years old, have a low or zero balance owed against your home and maintain the home as your main living place.
Many homeowners who live on a limited income and have a need for additional money find reverse mortgages helpful for their circumstance. Rates of interest may be fixed or adjustable and the funds are nontaxable and don't adversely affect Social Security or Medicare benefits. The residence can never be in danger of being taken away by the lender or put up for sale against your will if you outlive the loan term - even if the property value goes under the loan balance. If you'd like to find out more about reverse mortgages, feel free to contact us at 503-253-3299.
Do you have a question regarding a mortgage program?