Reverse Mortgages - All You Need to Know

By John Mazzara

Today you’ll find that reverse mortgages are becoming more and more popular in the United States today. Today seniors are being able to use these mortgages as an option to help them get by in their later years to help supplement their income, improve their home, and even pay off expenses that may occur unexpectedly as well. Real estate is a big investment and no doubt you have a lot invested in your home. So, it is important that you know all that you can about a reverse mortgage before you decide whether or not this is a great option for you. Although there is no financial or credit qualifying for the mortgage, there are other things to consider as well and you have to decide if this option benefits you or if you even quality for the option. So, let’s take a look at what is a reverse mortgage, the benefits of going with reverse mortgages, and who can qualify for a reverse mortgage.

Understanding a Reverse Mortgage

More than likely you are wondering, what is a reverse mortgage. Well, essentially this is a type of loan on your home that allows you to take the equity that you have in your home and you can get some of it back in cash. In some ways it is a bit like mortgage refinancing. Since you probably have equity that is built up in your home, you can have that equity paid out to you, but you won’t have to pay off that money until you leave the home. This is a great senior benefit that is available and these mortgages are insured by the federal government.

Benefits of Reverse Mortgages

You’ll find that there are a variety of different benefits to going with a reverse mortgage. While many people don’t really realize how they work, when they look closer, they see that they can provide some excellent benefits. It’s important that you take a look at all the benefits you can enjoy and decide whether or not the benefits are worth the costs that you’ll have to pay if you go with a reverse mortgage.

- Benefit #1 - Tap into Equity and Enjoy It - First of all, one of the main benefits of reverse mortgages is that it allows you to tap into the equity in your home and you’ll be able to enjoy it. Why wait to use the equity in your home. You might as well enjoy all the equity that is in your home and you can use it to help improve your quality of life as well.

- Benefit #2 - No Monthly Payments Until You Move or Die - Yet another great benefit of going with a reverse mortgage is that you will have no monthly payments to worry about until you move out of the home or you end up dying. This means that you’ll get your money and you’ll be able to avoid having any monthly payments to worry about.

- Benefit #3 - You Receive Monthly Payments - Instead of having to pay a monthly payment, when you go with a reverse mortgage, you’ll find that you’ll actually be receiving monthly payments from the lender. They’ll be giving you so much of the equity in your home each month, and you’ll be able to live on that money or enjoy spending it in any way that you choose.

- Benefit #4 - You Receive Loan Counseling - Of course before you even go with a reverse mortgage, you’ll find that you’ll receive loan counseling. This is an important benefit because it helps you to make sure that you are well informed on the reverse mortgage, it’s benefits and all that it has to offer you.

Qualifying for a Reverse Mortgage
So, now that you understand what a reverse mortgage is and the benefits of going with one, you may be wondering who qualifies for a reverse mortgage. Here is a look at the qualifications so you can figure out if you qualify or not.

- Homeowners Over 62 - First of all, if you are going to qualify for this senior benefit of a reverse mortgage, you’ll find that you have to be a homeowner that is over the age of 62. If anyone on the deed is under 62, you won’t be able to take advantage of this option.

- Own the Home or Have a Low Mortgage Balance - You’ll also find that you have to won the real estate yourself outright or you must have a mortgage balance that is fairly low. You’ll be getting the equity in your home, so if you don’t have any, you won’t quality.

- You Must Go Through Counseling - In order to qualify for a reverse mortgage, you’ll have to go through counseling. This way lenders are totally sure that you are aware of what you are getting into and what you are doing with your home.

- Eligible Homes - Last of all, you have to have a home that is eligible as well. Homes that are eligible include condos, townhouses, single family homes, and even 2-4 unit properties that you occupy and own.

Reverse mortgages for homeowners within Minnesota can be found at http://www.MinnesotaReverseMortgage.net John Mazzara is involved with financial services in the Twin Cities, MN. Officing out of Edina, Minnesota-John is centrally located within the 7 county MN metropolitan area. John owns three separate businesses-a licensed real estate broker associate selling Minnesota real estate since 1986-affiliated with RE/MAX Associates Plus http://www.MinneapolisStPaulHomes.com , an independent CFP-certified financial planner since 1989 with an independent Minnesota financial planning firm-Financial Planning Associates and the owner of a Minnesota mortgage broker firm-Venture Development Inc-specializing in residential, commercial and investment mortgages for purchases of single family homes, investment properties and commercial property. Venture brokers FHA, VA, Conventional loans and lines of credit. If you are looking for someone to help you in the areas of real estate sales/purchase, mortgages, or and/or financial planning and insurance you should call John for a free 1 hour consultation to see if he can meet your needs. 952-929-2577. RE/MAX Associates Plus and Venture Development are located at 7300 France Ave S, Suite 410, Edina, MN 55435

Photo by Kyle Pearce

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