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| Reverse Mortgages Let Seniors Utilize The Value of Their Home Without Giving Up Ownership. |
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The dramatic gains in the value of California real estate have made millions of seniors asset rich. A reverse mortgage enables seniors to take advantage of those gains by converting part of the equity in their homes into tax-free earnings without having to sell the home, give up title, or take on a new monthly mortgage payment. The reverse mortgage is aptly named because the payment stream is “reversed.” Instead of making monthly payments to a lender, as with a regular mortgage, a lender makes payments to you. Eligible property types include single-family homes, manufactured homes (built after June 1976), qualified condominiums, and townhouses. Enhancing Retirement Years... The funds from a reverse mortgage can be used for anything. Common uses include supplementing retirement income to cover daily living expenses; repairing or modifying your home (i.e., widening halls or installing a ramp); covering health care expenses; paying off existing debts; taking a vacation; paying property taxes; and preventing foreclosure. |
Payment Options... You can choose to receive the money from a reverse mortgage all at once (lump sum), as fixed monthly payments (for up to life), as a line of credit, or a combination of these. The most popular option – chosen by more than 60 percent of borrowers – is the line of credit, which allows you to draw on the loan proceeds at any time. The amount of money you get from a reverse mortgage depends upon your age (or age of youngest borrower in the of couples), appraised home value, current interest rates, and where you live (see Reverse Mortgage Calculator for an estimate). In general, the older you are and the more valuable your home (and the less you owe on your home), the more money you get. Paying Back The Loan... No monthly payments are due on a reverse mortgage while it is outstanding. The loan is repaid when you cease to occupy your home as a principal residence, whether you (the last remaining spouse, in cases of couples) pass away, sell the home, or permanently move out. The amount owed can never exceed the value of your home. Furthermore, if the home is sold and the sales proceeds exceed the amount owed on the reverse mortgage, the excess money goes to you or your estate. |
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SERVING ALL OF CALIFORNIA'S REVERSE MORTGAGE NEEDS