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A reverse mortgage is a home lending option that lets homeowners age 62 or over use the equity in their homes to improve their quality of life. Reverse mortgages offer unique benefits:
- Tax-free cash. You can convert a portion of home equity into tax-free cash that you can use for any purpose, including:
- Financing home repairs and renovations
- Eliminating an existing mortgage
- Paying property taxes
- Covering medical expenses or prescription drug costs
- Managing day-to-day living expenses
- Taking vacations
- Making special purchases.
- The ability to maintain ownership of the home.
- No payments required as long as you (or your spouse) live in the home.
- Flexibility to receive payments the way you want. You can receive funds in a lump sum, in monthly installments, or as a line of credit that you can draw on when you need to.
- No qualifying. There’s no income requirement and very little credit qualification required.
- Government-insurance. Most reverse mortgages are Home Equity Conversion Mortgages (HECMs) which are insured and regulated by the Federal Housing Administration (FHA).
- Built in consumer protection. All reverse mortgages offered today have built-in features that prevent you and your heirs from owing more than the value of your home – even if your home declines in value.
- No impact on Social Security and other benefits. Reverse mortgages will not affect your Social Security, Medicare, pensions, other investments.
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