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Reverse Mortgage

As retirement approaches, you might begin to wonder how you will support yourself with how the social security funds are disappearing these days. One option that you might look into that could be beneficial to you is getting a reverse mortgage. This is a good option for people who own their home or have it almost paid off so that they can enjoy retirement and it can supplement some other options for you. Learning what a reverse mortgage is will better help you to understand if you can get one and what you need to do. 


A reverse mortgage was made for people who are sixty two years old or older and own their home or are super close to having their loan paid off. The name or the mortgage describes it pretty well, because the mortgage company sends the person a payment each month for the term of the loan, and then the loan has to be paid back or they can sell the home. Whatever your home is worth at the time, you will take out a reverse mortgage for that amount, and the lender will pay you a certain amount each month, based on a lot of things, including your age. When the term of the loan comes to an end, you will have to pay the loan back by selling your home or give the lender the cash to pay it off. If you do not live to see the end of the term, the house gets sold after you die and that will pay the loan back, even if the value is lower and the sale will not cover it all. Your beneficiaries will not end up owing any extra money to the lender after this is done. If selling the house earns more money than the loan was for, the extra will be put back into your estate. 


Getting a reverse mortgage is a good way to use the equity in your home after you have retired so that you can live a comfortable life during your retirement if you do not have much, if any, social security. If there is some mortgage refinancing in your history, that mortgage refinance will also have to have been paid off before you could get a reverse mortgage. If you had to have a bad credit loan and wonder if you would be eligible for a reverse mortgage, the answer is yes; you should still be able to qualify as long as you have paid it off or are really close to doing so. 


The best way to find out if you will qualify for a reverse mortgage is to go out and talk to a loan officer who can explain all your options to you and then you will be able to decide if this is the road you should take.