When you’re headed
into retirement and planning for an income change, the idea of taking on a new
mortgage can be intimidating. However, there is an option that might work
better for you. A reverse mortgage is a special type of home loan for those
aged 62 and up that does not require monthly mortgage payments. The loan is repaid after the death of the homeowner(s).
When should I consider a reverse mortgage?
A reverse mortgage is not for everyone. It is best suited
for those who can afford to maintain their
home and do not plan to move. Some people use their loan to pay off home
improvements or to supplement income upon retirement. Another popular use
for a reverse mortgage is to purchase a second home, either to vacation in or
to rent out to tenants for extra income. There is no restriction on how the
funds can be used, only how much will be lent to the borrower.
What are the criteria to qualify for a reverse mortgage?
When applying for a reverse mortgage, the following factors
will be considered:
- Your current age
- What type of reverse mortgage you want
- The appraised value of your home
- Current interest rates
- Financial assessment of your ability to pay and maintain all homeowner expenses, such as insurance, property taxes, and regular maintenance
Of course, there are other
factors that play into your eligibility to qualify for a reverse
mortgage, but these are the most common based on standard mortgage lenders.
If you’re looking to supplement your income, this is one
very effective way to do it, while making sure your home is still covered. Contact Mortgage Investors Group today and we can help you get the best loan for your home.
