With the economic downfall in the recession period Seniors Reverse Mortgage loans have become very popular. They are much different from the traditional home loans in several ways. People over the age of 60 years have benefited from such type of loans. This has increased the popularity of seniors reverse mortgage very much. Let us look at the benefits and drawbacks and come to know about the loan more closely.
Generally in a normal mortgage, the borrower repays the loan amount in regular monthly installment basis. But in senior reverse mortgage the borrower gets the money without worrying about any monthly repayments. The whole amount of the loan and all other costs are paid back only at the time of closing of the loan. Thus this has relieved the tension of frequent ups and downs of your economic situations, and can enjoy a normal living standard during the tenure of the loan. Usually the amount of a seniors reverse mortgage loan varies according to a person’s age, the value of the home, loan fees and also the current interest rates of the market.
Since you do not have to make any monthly repayments, the qualification in terms of income gets easy. In other words, if you earn nothing and do not have an income, then also you can qualify for a reverse mortgage. This also proves that your credit history is taken less into consideration. The only factor that you need to fulfill is that you should at least be 62 years old and you have enough equity in your home. In general, the older you are, the more expensive becomes your home and the lower the interest rates, more money you can lend with a seniors reverse mortgage. A significant factor is that seniors reverse mortgage is insured by the FHA and the money received is usually tax free income.
As there are many advantages of the reverse mortgage, there are also some major drawbacks. It is always good for you to know the drawbacks before applying for such a loan. Most of the reverse mortgages have a variable rate of interest which varies with the market. Since you have the ownership of the home, you are responsible to pay all the real estate taxes, insurance and maintenance costs. Lenders may ask for originating fees and other closing costs also. The interest paid on the reverse mortgage is not deductible in your income tax returns until your home mortgage is paid off.
With all these drawbacks you should always make sure that you educate yourself more by consulting a financial advisor before going for the best deal. If you are a senior citizen of 62 years or above, and finding it difficult to get by the economic hardships, the best option is always open for you – Seniors Reverse Mortgage Loans.
Generally in a normal mortgage, the borrower repays the loan amount in regular monthly installment basis. But in senior reverse mortgage the borrower gets the money without worrying about any monthly repayments. The whole amount of the loan and all other costs are paid back only at the time of closing of the loan. Thus this has relieved the tension of frequent ups and downs of your economic situations, and can enjoy a normal living standard during the tenure of the loan. Usually the amount of a seniors reverse mortgage loan varies according to a person’s age, the value of the home, loan fees and also the current interest rates of the market.
Since you do not have to make any monthly repayments, the qualification in terms of income gets easy. In other words, if you earn nothing and do not have an income, then also you can qualify for a reverse mortgage. This also proves that your credit history is taken less into consideration. The only factor that you need to fulfill is that you should at least be 62 years old and you have enough equity in your home. In general, the older you are, the more expensive becomes your home and the lower the interest rates, more money you can lend with a seniors reverse mortgage. A significant factor is that seniors reverse mortgage is insured by the FHA and the money received is usually tax free income.
As there are many advantages of the reverse mortgage, there are also some major drawbacks. It is always good for you to know the drawbacks before applying for such a loan. Most of the reverse mortgages have a variable rate of interest which varies with the market. Since you have the ownership of the home, you are responsible to pay all the real estate taxes, insurance and maintenance costs. Lenders may ask for originating fees and other closing costs also. The interest paid on the reverse mortgage is not deductible in your income tax returns until your home mortgage is paid off.
With all these drawbacks you should always make sure that you educate yourself more by consulting a financial advisor before going for the best deal. If you are a senior citizen of 62 years or above, and finding it difficult to get by the economic hardships, the best option is always open for you – Seniors Reverse Mortgage Loans.
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