Wednesday, December 11, 2013

How Does a Reverse Mortgage Work?

If you need cash and would like to borrow against your home equity, then a reverse mortgage in Fort Walton Beach may be a viable solution. A reverse mortgage will allow you to retain the title and ownership of your home, while providing the financing you need now. This powerful financial tool will allow you to convert a portion of your home equity into tax-free funds. This can help to provide any eligible senior citizen with peace of mind and financial security.

Receiving the Funds

In most cases, there are a variety of payment options that you can choose from, including receiving the proceeds in one lump sum in cash, as a line of credit, through equal monthly payments over time, or through monthly payments for as long as the borrower lives in the home. In most cases, the total loan balance, which includes the principal of the loan, along with any accrued interest and fees, will be due once you no longer occupy the home. This means that you do not have to worry about another monthly payment and the loan can be paid at anytime either in whole or as a partial repayment.

Are You Eligible?

There are special mortgage programs set up for certain types of borrowers. For instance, senior citizens may be eligible for senior reverse mortgages, which can provide the equity you need, right when you need it. In order to qualify for a reverse mortgage, the borrower must be 62 years of age or older, own the home, and have no liens against the home. There are no income, employment, or medical qualifying restrictions to apply.

Is a Reverse Mortgage for You?

It is always advisable to speak with a financial advisor prior to making any large decisions about your finances. Once an expert has assessed your current finances and your post-retirement home financing goals, they can recommend which financial solutions may be best for your current situation. While a reverse mortgage in Fort Walton Beach can assist with your finances, you will still be responsible for any property taxes, insurance costs, and home maintenance.

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