A reverse mortgage can be a fantastic way to free up money once you become 62 years old. For those who have close to full equity in their home, receiving one can alleviate lots of anxiety about finances. That said, before starting the process, you should educate yourself on everything that it entails. In today’s blog, Family Home Loan Texas discusses the things you need to consider before getting a reverse mortgage.
Knowing What It Is
Similar to most big decisions, you need to understand the basics of a reverse mortgage before you undergo the process to receive one. At its core, this type of mortgage allows you to leverage the equity you have in your home to receive a loan. As its name suggests, this loan is functionally the opposite of a mortgage. Instead of making monthly payments to a lender, the lender pays you. The funds can either come as a lump sum, monthly payments, or a line of credit. While you will eventually have to pay back the loan with interest, it isn’t due until you move out of the house you take the mortgage out on. It is essentially turning the equity you have built up in your home into spendable, liquid funds.
Are You Eligible?
Before you begin the process of getting a reverse mortgage, you need to be sure you are eligible. For starters, you must be at least 62 years old and you need to have at least 50% equity in your home. The home you take the loan out on needs to be your primary residence — you cannot spend more than 12 consecutive months outside of it. Your property must either be a single-family residence or a rental property with no more than 4 units — and you living in one of them.
What To Expect From The Process
If you are eligible for this mortgage, it is also wise to understand the process of receiving one. To start, you should meet with a loan specialist, so they can explain what to expect. Next, you will meet with a third-party reverse mortgage counselor who’s approved by the U.S. Department of Housing and Urban Development), to make sure you understand all aspects of the loan and that you won’t be surprised by any of the terms. From there you will gather all of the required documents and submit the loan. If it is approved, you will sign closing documents with a title office or attorney. Finally, you will receive your money.
Contact Us To Learn More About Reverse Mortgages
We know there’s a lot to understand about reverse mortgages, but we are here to help you through the entire process. We want nothing more than to help you achieve the utmost financial freedom. Family Home Loan Texas was founded by loan originator and long-time mortgage professional Rob Bramer. Rob has helped clients secure the loans they need both locally and nationally and can help you get the loan you need to live life on your terms. Call 1-800-990-LEND (5363) to speak with Rob about a reverse mortgage loan.