Will A Reverse Mortgage Affect Your Existing Loans and Benefits?

A reverse mortgage is one of the many options that can help increase the financial support of those who are already on their retirement age.

A reverse mortgage loan is also referred to as HECM or HomeEquity Conversion Mortgage. It allows seniors to convert their home’s value to funds or cash that could be used right away. This is a wonderful addition to other retirement alternatives for those who would like to increase their funds for expenses like home improvements or tours.

What Is A Reverse Mortgage Loan For?

A reverse mortgage loan isn’t necessarily meant for costly activities. Most borrowers use the reverse mortgage loan to fund their daily needs and help them live more comfortably. It is an excellent addition to Medicare and Social Security benefits.

There are a few who believe that reverse mortgage could affect their benefits they receive from the government like social security and healthcare. As a matter of fact, a reverse mortgage loan doesn’t affect your membership status with social security. But it will have a small impact on your Medicare benefits. In case the healthcare department can detect that you are getting a large amount of cash every month, then they may choose to lower you renumeration, or they could deny your Medicare application so they could accommodate the needs of other members.

There is something you can do in order to avoid this particular inconvenience. You can keep the loan’s proceeds in the bank since it would be misconstrued as your asset. Keep in mind that the purpose of a reverse mortgage is to finance your expenses, and it is expected that the monthly amortization is going to be spent in the same calendar month. In case the money is spent right away, it won’t have an impact on your Medicare standing.

In case you are considering a reverse mortgage Greenville even if you have a current mortgage in your name, the reverse mortgage should be your primary loan. In case the eligible amount of the equity of your home is enough to cover your outstanding loan, then you can proceed with the reverse mortgage loan. It’s also helpful to remember that the difference between your existing loan as well as the reverse mortgage proceeds should leave you with sufficient funds, because if not, it could cost you so much more.

Because even then, you entire reverse mortgage loan would be used up. You won’t receive monthly payments anymore and if the left over cash is found to be too little then you may wind up in a difficult financial situation in the future. It’s also possible to make use of the whole loan amount to pay off your current debt and if still not enough, you can use your personal savings to pay for the remainder of the loan.

Even though it’s possible, it’s advised not depend on reverse mortgage to pay off your outstanding debts if you could find other sources of money like investments and retirement accounts. Reverse mortgage loan Greenville would be effective for real expenses instead of debt payment due to the ceiling of the amount that you could borrow.

Call Reverse Mortgage Specialist if you wish to learn more about reverse mortgage loans.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

All About Reverse Mortgage Interest Rates

There are different options about getting loans when you are at a point in your life where you have to make ends meet. Several options are offered by the majority of them, there are stringent requires in order to be eligible for the grant. The commonly depend on the borrower’s credit score and his or her capacity to pay. However, one kind of mortgage is different and many people, particularly seniors, opt for this type of loan. It is called reverse mortgage. Just like its name suggests, reverse mortgages work the other way around when compared to conventional loans. You are not the one who will be making payments but you will be receiving them instead.

But not everyone could enjoy the advantages of reverse mortgage loans. Just the whole process of getting the mortgage could be quite confusing and could cost you more money especially if you have no idea about the basics. And most likely, one of the most important things that you must know about this type of loan is the interest rate that is involved.

Interest Rates: What Is The Best Offer?

Reverse mortgage specialists said that the interest rate of a reverse loan is based on several factors like your home’s appraisal value. And the rates differ from each lender. The usual rates begin at 2% of the home’s actual value where the equity will be drawn up against. However, this rate is just prevailing in the Federal Housing Administration grants. It could be much higher at other lending firms.

Adjustable and Fixed Reverse Mortgage Loan

Paying off the interest rates could also depend on whether you will choose a fixedor adjustable reverse mortgage. The first one won’t let you choose a single cash payment so you just have the credit lines or the monthly payments. And you need to pay the interest rates together with the monthly payments. It’s the opposite when it comes to an adjustable loan where you are allowed to choose from all the three kinds of payments. The average rate you’ll get is a bit above 6%.

Tips To Find A Lender With Better Interest Rates

If you would like to get a great reasonable interest rate then the best thing you should do is to shop around and then compare all the options you’ve obtained. You could perform an online search and find any reverse loan lender that is available in your area. Additionally, search for the lowest prevailing rates and don’t hesitate to bargain with your selected lender.

Online Reverse Mortgage Calculator

When you are researching online for the best reverse mortgage loan lender, make full use of the online rate calculators that are commonly available on the website of the lenders. You could use this to calculate the reverse mortgage loan that you could get based on your home’s appraisal value. You could compute the interest rate that you are going to pay just in case you could get a loan. This could be your guide when determining if a reverse mortgage loan is for you or not.

It is important to know the best interest rate since this is one of the most crucial factor that could make the reverse mortgage loanGreenville the worst type of loan for you, especially if you don’t know what it really is and if you fail to find the best rates for you.

Call Reverse Mortgage Specialist if you want to know the best interest rates for you.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

Debunking The Myths About Reverse Mortgage

There are several misconceptions circulating about reverse mortgages. Despite the suggestions from the America Association of Retired Persons, the concept of obtaining a reverse mortgage worry a lot of seniors. It’s even made worse by friends or family who say that reverse mortgages are bad without even presenting enough evidence to back up their claims.

The truth about the myths surrounding reverse mortgages.

Reverse mortgage lead to houses being taken away from the borrowing senior.

This is one of the most common misconception about this kind of mortgage loan. This is not true. As a matter of fact, the senior borrower would continue to have ownership of the house that’s under the reverse mortgage program. This homeownership is made much more secured by the lien that’s placed upon the property, just like any other type of mortgage. It will guarantee that the lender would also be repaired form the owed amount, getting rid of the threat of the house getting removed from the senior borrower.

Since the majority of reverse mortgages are FederalHousing Administration Home Equity Conversion Mortgage (HECM) types. The US government guarantees full protection by using the mandatory 3% insurance fee that’s payable on all the FHA reverse mortgages.

The other types of reverse mortgages are referred to as Proprietary Reverse Mortgage and the Federal National Mortgage Association. These are guaranteed and safe by the private lenders.

Reverse Mortgage Is Costlier Than Other Types of Mortgages

This is not true. The closing cost of a reverse mortgage is only 1% higher than an FHA mortgage when obtained on the exact same property. Traditional mortgages tend to charge at least 2%.

The interest rate also plays a crucial role. Although the prime rates are used by conventional mortgages as their base, the FHA reverse mortgage interest rate will depend on the one year UnitedStates Treasury Note. This simply implies that the interest rate made through the reverse mortgage is way lower than a conventional mortgage.

The Home Will Be Given To The Lender Once The Borrower Dies

It is not true that the lender will take your home once you die or if you decide to relocate or sell the house. It actually follows the exact same procedure as a typical mortgage where the home equity goes to the heirs of the borrowers or the estate.

A reverse mortgage loan will have the estate pay the reverse mortgage lender the home value during the time of repayment. The exact same thing will apply in the case of significant decrease in the home value or when the borrower will reach extreme old age.

Tax Can Be Imposed On A Reverse Mortgage

It’s also not true that tax can be imposed on a reverse mortgage loan and that health insurance and Social security will be affected by the loan terms. Always remember that a reverse mortgage is a loan and not an income.

In case you need to know more about reverse mortgages and the benefits it has to offer, call Reverse Mortgage Specialist now.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

All About Reverse Mortgages

If you are thinking of getting a reverse mortgage loan, you need to know its in and out first before submitting an application.

Reverse Mortgage Benefits

Access To Cash

By having a reverse mortgage loan, you will be able to access your home equity without having to sell your house. These funds could provide you with the extra money you need during your retirement years to pay off your mounting debts, to maintain your way of living, and to take care of unexpected expenses.

No Need To Pay Monthly Mortgage

Just like a reverse mortgage Greenville, the home equity loan will borrow against the equity of your home. However, with a home equity loan, you need to make monthly payments, which will cut into the amount you have left to spend. But with a reverse mortgage, you do not need to make monthly payments. The loan just needs to be repaid when you sell your home, pass away, or move out and it is usually paid for with the money from the proceeds of your home. You don’t need to pay off the interest or loan balance before then.

Maintain Ownership of Your Home

You are still the owner of your house after getting a reverse mortgage loan. The lender will not get the title or the right to sell your home as long as you continue to pay the housing costs, including the homeowners insurance and property taxes. The home will still be yours until you pass away or move out. Even when you move out, you will still have the option to pay off the loan to keep your property.

Flexible Payment Options

You will have different methods of borrowing through a reverse mortgage like a line of credit, a lump sum, or a lifetime payment. You could switch from one payment option to another during the loan.

Medicare and Social Security Remains Unaffected

If you get money from a reverse mortgage, it will count as a loan and not as your income. Consequently, your Medicare and Social Security won’t be effected.

Reverse Mortgage Drawbacks

Fees

Reverse mortgage lenders often charge several fees to close on as well as maintain a reverse mortgage. Although you don’t need to pay most of the fees until you decide to move out of your house, you would receive less cash overall compared to selling the house outright.

Interest

Since a reverse mortgage is a loan, an interest will be charged on the amount that you will take out. Although you don’t have to pay the loan as long as your home remains as your primary residence, this will reduce the amount you or the heirs will get once the house is sold.

No Annual Tax Deduction

The interest on the reverse mortgage isn’t tax deductible. Since you don’t need to make payments on the interest as long as you live in your house, it can’t be taken out every year however, it will instead build up on the mortgage balance. The interest will just be deductible if the reverse mortgage loan is settled either fully or partially.

Loan Repayment

In case you live somewhere else aside from your house, you have to repay the reverse mortgage. Your loan will be due once you live in another house for nonmedical reasons for most time of the year. Apart from that, once you move out due to medical purposes, like to an assisted living facility, and you are out of your house for over 12 months, you have to repay your loan. This could force you to settle the reverse mortgage loan much earlier than expected.

Additional Housing Costs

Even though you do not have to make loan payments on this type of loan, you still have to cover other types of housing costs, like housing association dues, maintenance, and taxes. In case you fail to follow these payments, the lender could foreclose on your house.

Smaller Inheritance

A reverse mortgage loan could decrease the inheritance for your heirs because it cuts down the equity in your house. In case your heirs put your home in the market following your death, the proceeds will be used to pay off the reverse mortgage loan and the remaining ones will be given back to your heirs.

Reverse Mortgage Eligibility Requirements

Eligibility would vary based on the kind of loan as well as the lender. HECMs have set these requirements.

1.    You must be at least 62 years old.

2.    Your property must be your primary home.

3.    Your house should be paid off or should have a low mortgage balance.

4.    You should be able to cover future housing costs.

5.    You shouldn’t have any delinquent federal debt.

6.    You should meet the property requirements.

7.    You must meet with an HUD approved counsellor.

If you’re married, you as well as your spouse must be listed as the coborrowers of the reverse mortgage loan so that in case one dies, or need to move out for medical reason, the other one could continue living in the home and get money from the reverse mortgage.

However, this might not be possible in case one spouse is below 62 years old, which is the minimum eligible age to take out a reverse mortgage. When this happens, only the spouse who is at least 62 years old could be listed as a borrower.

Call Reverse Mortgage Specialist if you are interested in this kind of loan.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/

10 Reverse Mortgage Facts You Need To Know

There exists a unique type of refinancing option that is available solely for homeowners who are at least 62 years old and it is called reverse mortgage. Are you interested in applying for this type of loan? If you are trying to figure out if you need to move forward with this loan, you should have the right information first. We are here to be sure that you get your questions addressed. Listed below are 10 important things you need to know about reverse mortgages.

Reverse Mortgage Is A Loan

Reverse mortgage is a type of loan that’s made specifically for people who are above 62 years old who would like to access a part of their equity. The amount of cash available to the borrower will be determined by the value of the house, the current interest rates, as well as the age of the youngest borrower or the non-borrowing spouse. Just like with any other kind of loan, it must be paid back at a certain point in time. You could sell the house or pay off the loan with a no prepayment penalty.

What Are Your Options?

In case you move out of the house or you pass away, you and your loved ones will some options when it comes to paying the loan off.

1.    You can put it up for sale and use the proceeds to pay off the loan balance and the remaining money will be yours to keep.

2.    Heirs could purchase the house if it is something that they would like to reside in, keep, use, or hold as the value increases. To buy the house, they would have to pay only the loan balance or 95% of the home’s appraised value, whichever is less.

3.    If you or your heir don’t want to do anything with the house, you could simply sign the deed over to the reverse mortgage lender and just walk away from the house.

Reverse Mortgage Can Answer Immediate and Future Goals

There are some individuals who get a reverse mortgage loan to eliminate, pay down, or consolidate their current mortgages, home equity loans, as well as other kinds of debts. Others utilize the money they receive to  create an emergency fund, increase their borrowing power, defer drawing on other assets.

Different Kinds of Reverse Mortgage

Single Purpose Reverse Mortgage – offered by state, local, or non profit agencies. It must be used for purposes that are state specific.

HECM or Home equity conversion mortgage – it is issued by the federal government and the borrower must go through a counselling session before they can be approved. It is offered at one Reverse Mortgage.

Proprietary Reverse Mortgage – it is not insured by the government and it is available to people who have houses with high appraisal value.

HECMs Are Popular

The first reverse mortgage that was federally insured was issued back in 1991. After one year, there were 157 HCEMs were made. By the end of 2017, there were over 55,000 HCEMs created. Because the reverse mortgage has become a federally insured loan, over 1 million HECMs have been made.

The Financial Assessment

Before you get your HECM, you have to go through a financial assessment. This will check your income and your credit history to make sure that you are willing and able to adhere to the financial responsibilities of the loan. Credit score isn’t a requirement at this point. According to the result of this assessment, some of the proceeds of the loan might be set aside to pay off the property taxes as well as the homeowners insurance.

You Still Own Your House

If you are approved for a reverse mortgage loan, you will not sign over your home to the lender. You will be the owner of the house and your name will still be on the title.

Five Payout Options

Unlike other kinds of loans, reverse mortgage loans provides different methods to get your proceeds. Based on which HECM product you go for, there could be as much as five different payout options. You could get the funds in one lump sum, tenure or monthly term payments, as a line of credit, or any mix of these options.

Reverse Mortgage Proceed Values Vary

The proceed amount you will receive from your house differs from one person to another and will be based on various factors. These factors include the value of your home, your age, financial goals, and in case you have an existing mortgage on the house.

You Can Use The Money As You Please

The proceeds from a reverse mortgage could be used any way you like. You should create the best plan on how to use your reverse mortgage by talking to a reverse mortgage specialist and taking into account your retirement and financial goals.

Call Reverse Mortgage Specialist if you want to know more about this type of loan.

David Stacey
Reverse Mortgage Specialist
Greenville, SC 29607
864 920 2733
http://reversemortgagegreenvillesc.com/