Reverse Mortgages

Reverse Mortgage Lender

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Reverse mortgages, also called the lifetime mortgage is a unique type of a home loan that allows seniors (people over 62 years) to access loans by using a portion of their home equity as collateral. The borrower can use the money loaned in whatever way that they wish.  The most unique thing about this type of loan is that it’s not repaid until the last survivor of the loan dies or vacates the property.

What You Need To Qualify For the Reverse Mortgage

As mentioned above, to qualify for the reverse mortgage, you must be a senior (you must be 62 years of age and above). In addition, you must own a home that is fully paid or partially paid. If the home is partially paid, the mortgage balance should be minimal such that it can be offset by the proceeds obtained from the reverse loan.

Furthermore, the borrower must live in the home that they are using to access the reverse loan.

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The Amount That the Borrower Can Get From the Reverse Mortgage

Reverse Mortgage for seniorsThe amount that the borrower can get depends on two principal factors: the borrower’s age and the value of borrower’s home.

An older person has higher chances of securing a reverse loan as compared to a younger one. Therefore, a 75 year old man will have higher chances of securing the loan as compared to a 65 old man.

The reason why the older person will secure the loan much faster and of a higher amount than a younger person is because the lender will have to repay the reverse mortgage for the younger person for a longer time than they would pay for the older individual. It is assumed that the older person will die much sooner than a younger individual would.

The value of your house is directly proportional to the amount of reverse loan that you will get; where, the higher the value of your house, the larger the amount of loan that you will receive and vice versa.

Ways of Receiving the Reverse Mortgage

After Custom Mortgage has valued your property and you have agreed to the amount of the loan that will be given to you, there are many ways in which you can receive the loan.

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One common way of using the loan proceeds is the tenure method. This is where the borrower is given a fixed amount of money per month. The borrower is given the money for as long as they are alive and they continue to occupy the house.
Another way the borrower can receive the money is using the term method. This is where the borrower receives fixed amounts of money for a fixed length of time (months or years).
Another way is using the line of credit. Here the borrower receives the reverse loan in unscheduled installments and payments until the line of credit is exhausted.
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Who is a Reverse Mortgage For

The reverse mortgage is a must have for anyone constrained of cash in their senior years; therefore, if you are house rich but cash poor, why not get the reverse loan and make your golden years more golden?

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