Reverse Mortgage - Five Facts That Every Senior Homeowner Ought to Know

By Steve Bingman

Almost every senior citizen homeowner has heard of a reverse mortgage. Here are 5 facts about reverse mortgages that every senior citizen homeowner ought to know.

One: A Reverse Mortgage is real. It is not a scam.

Most senior citizens have heard that they can receive money and not have to pay the money back as long as they live. It seems too good to be true, but it is true. Reverse mortgages are recognized by federal and state governments. In fact, reverse mortgages were actually created to help senior citizens.

There are crooks who will take advantage of senior citizens in any way that they can, but if you deal with a reputable mortgage company, you should not have a problem a reverse mortgage.

Two: You receive money, but you do not pay it back until you no longer live in your home.

With a reverse mortgage, a senior homeowner actually borrows money, but does not have to pay back the money back until he/she no longer lives in the home. The way it works is that a mortgage company determines the maximum amount that you can borrow, then as you receive money, the amount of money that you receive along with interest is deducted from the maximum amount. When you reach the maximum amount, you cannot receive or borrow more money. The reverse mortgage loan is paid back when you sell your home. If you stop living in your home, you will need to pay off the reverse mortgage loan, and you can pay off the loan by selling your home or with money from another source.

Three: You cannot be foreclosed upon as long as you live in your home.

Reverse mortgages do not require regular mortgage payments. In fact, you do not have to make any monthly payments repaying the loan. Because there are not any regular payments due, a reverse mortgage cannot be foreclosed on for failure to make regular or monthly payments.

Four: You can get a reverse mortgage even if you have bad credit.

Reverse mortgages are based on the equity (value less mortgage and/or other liens) that you have in your home. Your credit and/or credit score does not make a difference. With a reverse
mortgage, a mortgage company is looking at your home for repayment of its loan and not looking
at you for repayment.

Five: You can receive money in several ways: lump sum, monthly payments, or wait until you need
it.

Reverse mortgage loans were created to help senior citizens. Some senior citizens need a monthly supplement to help pay bills. Some need a lump sum. Others do not need money now, but want to have money available in the future in case of an emergency. A reverse mortgage can help in all of these situations.

This is general information only. If you have any questions about reverse mortgages, talk with a mortgage lender, and if you have any legal questions, talk with a lawyer licensed in your state.

This article may be republished, but the wording must not be changed and the author links must remain active.

Stop! Wouldn’t you like to know if a reverse mortgage is right for you? For a FREE eBook and more more information, click here on Reverse Mortgage. And click here for more insights on How Does A Reverse Mortgage Work.

Photo by Chris Gladis

Related posts:

1. Find Out If You’re Eligible For a Senior Reverse Mortgage By Matt Murren If you are a senior citizen and...
2. Reverse Mortgages Learn The Facts First! By Vincent Dail Reverse Mortgages, Most Common Features: Many offer...
3. Reverse Mortgage Important Facts There are numerous pertinent and important facts to remember regarding...
4. Reverse Mortgage the Great Solution For Seniors In today’s world more and more seniors start feeling insecure...
5. Be a Happy Senior - Reverse That Mortgage By Matt Murren If you are a senior citizen (age...

Related posts brought to you by Yet Another Related Posts Plugin.