A reverse mortgage is a unique loan that allows senior citizens access to their home equity without having to sell their home. This type of mortgage allows borrowers who are 62 years or older to live in the home that they currently own while receiving a monthly cash payment or line of credit. Reverse mortgages can offer great benefits to senior citizens, and if you are interested in learning more about this program, Dan Turner with Geneva Financial can help you understand the reverse mortgage process in the areas of Hawaii, Illinois, or Ohio. Here are some common myths and truths about reverse mortgages.

Reverse Mortgage Myth #1: A Reverse Mortgage Means Monthly Payments

Truth: In a reverse mortgage, a borrower does not make payments to a mortgage lender, in fact, it provides the borrower with an additional monthly payment that is paid for by the lender. Clients who have a reverse mortgage can either receive their payments as a sum of cash or a line of credit, and once the reverse mortgage contract begins, the borrower will no longer be required to pay monthly mortgage payments. The borrower can use the income they receive from the reverse mortgage for any reason they choose, such as healthcare costs, home improvement costs, etc. The only cost associated with a reverse mortgage for the borrower will be fees for mortgage insurance, property tax, and upkeep of the property.

Myth #2: I Could Be Forced To Move From My Home

If you continue to meet the obligations of your reverse mortgage contract, you can live in your home no matter what your age is, until you pass away. To fulfill the requirements of your contract, you need to continue living in the home as your primary residence and continue to pay for normal homeowner’s expenses and home maintenance costs. If you continue to fulfill these requirements, you cannot be forced to move from your home.

Myth #3: My Home Cannot Be Inherited By My Family Members of Loved Ones

In a reverse mortgage, the equity in your home is used as collateral against your loan, and your home remains your property for the length of the mortgage. In a reverse mortgage, the loan ends when you move out or pass away, and when one of these events occurs, the remainder of the mortgage will become due. If your heirs would like to keep the home, they would have the option to pay off the rest of the loan and retain the property. In the event that your heirs opt to not keep the home, it would then be sold off to pay the loan balance. Even if your home is sold for less than the remainder that is due, your family and loved ones will not be liable to pay the difference in the cost.

Get Advice About a Reverse Mortgage

If you want to learn more about the benefits of a reverse mortgage, Dan Turner with Geneva Financial, can help you distinguish the facts from the myths. Contact our office today to receive financing guidance in the areas of Hawaii, Illinois, and Ohio.

 

 

-For Hawaii Retiree’s living in Hawaii Kai, Kaneohe, Waikiki, Ewa Beach, Honolulu, Wapahu, Pearl City, Kailua, Mililani, Manoa, Hilo, Kapole’i, Waikoloa Village, Kailua-Kona, Kamuela, Honoka’a, Mountain View