Reverse mortgages (also referred to as "home equity conversion loans") enable older homeowners to benefit from their equity without having to sell their home. The lender pays you money determined by your home equity amount; you get a lump sum, a payment every month or a line of credit. The loan does not have to be repaid until the borrower sells the residence, moves out, or passes away. You or representative of your estate is obligated to repay the reverse mortgage amount, interest accrued, and finance charges when your home is sold, or you no longer live in it.
Most reverse mortgages require you be at least 62 years old, have a low or zero balance owed against the home and use the property as your main living place.
Many homeowners who live on a fixed income and have a need for additional funds find reverse mortgages ideal for their situation. Rates of interest can be fixed or adjustable while the funds are nontaxable and do not adversely affect Social Security or Medicare benefits. Your lender will not take away your property if you outlive your loan nor will you be made to sell your home to pay off the loan amount even if the loan balance grows to exceed property value. If you'd like to learn more about reverse mortgages, please contact us at 504-866-5626.
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