In a regular mortgage, you make monthly payments to the lender, in a reverse mortgage, you receive monthly payments from the lender and generally don’t have to pay it back for as long as you live in your home. You are basically taking equity out of your home in the form of monthly payments made to you. The loan is repaid in full when you die, sell your home or when your home is no longer your primary residence. If you make more money on the sale of your home than was required to pay off your mortgage, you get to keep the proceeds. These proceeds are generally tax free, and many reverse mortgages have no income restrictions. If you’re a 62 year old or older and looking for money to finance a home improvement, supplement your retirement income or pay for health care expenses, you may want to consider a reverse mortgage. It’s a product that allows you to convert part of the equity in your home into cash without having to sell your home or pay additional monthly bills.
These reverse mortgage loan advances are not taxable and generally don’t affect your Social Security or Medicare benefits. Terms and conditions can vary widely among lenders. A reverse mortgage may help fill in the gaps of retirement income shortfalls. Give us a call today to find out if a reverse mortgage is right for you.