Reverse Mortgage Information
A reverse mortgage loan is a popular method of borrowing money against the value of your home, especially for senior citizens looking to enhance their retirement funds by settling all debts.
The difference between a reverse home mortgage and your standard mortgage is the fact that reverse mortgages do not require monthly payments. The elderly can withdraw the funds as a lump sum when needed or on a more consistent basis, such as every month. Interest fees on the amount borrowed are deducted from a home equity line of credit on a monthly basis.
Advantages & Disadvantages of Reverse Annuity Mortgages
When applying for a reverse mortgage loan you are not bogged down by having to make a monthly mortgage payment. The loan must simply be paid back in its entirety should the house be sold or the borrowers pass away. Although interest rates on a florida reverse mortgage are fair, the opening fees are relatively high. This is because the borrower’s age must be at least sixty-two years, making the security of the loan less stable. Therefore, in general reverse mortgages are riskier than the conventional mortgage loans. If your home equity decreases over time, a reverse mortgage could dry up the entire equity of your home due to monthly interest charges.
Despite these few drawbacks, reverse mortgages are an attractive option for senior citizens looking for consistent financial support, especially if all they have to use as collateral is their home.
California Reverse Mortgage
Reverse mortgages in states such as California, Florida and Texas are very popular given the relatively high cost of mortgage loans. In counties like Los Angeles, San Francisco and San Diego, reverse mortgages are an attractive alternative, especially in times of home price appreciation. To find a reverse mortgage lender in your area, simply fill out our two minute loan application and up to 3 lenders will compete for your loan.