What is a Reverse Mortgage?
One of the most common type of federally-insured mortgage formally known as a Home Equity Conversion Mortgage (HECM) is called a reverse Mortgage. The Reverse mortgage loans California gives eligible homeowners access to their home equity in the form of a loan advance.
The mortgage has helped millions of American seniors to remain in their homes while having access to a flexible credit or even accessing cash in a lump-sum to supplement their retirement income.
How a Reverse Mortgage Work
Traditional mortgages require borrowers to commence monthly mortgage repayment to lenders immediately after the loan closes. The loan balance continues to decrease with each monthly payment of the principal and interest.
The process is reversed in a HECM or reverse mortgage. Instead of making monthly repayments, the lender pays the borrower money upfront either in a lump-sum or over a certain period.
The exact amount you can receive depends on the appraised value of your home, the equity of your home, the age of the youngest borrower (if you have a spouse), and other factors.
The Reverse mortgage loans California becomes due for full repayment when the borrower moves out of the property, sells the home, or dies. In any case, the loan is paid back through a handful of repayment options.
Who is Eligible for a Reverse mortgage loans California?
Below is the Reverse mortgage information:
Any homeowner who is 62 or older may qualify for a reverse mortgage if:
- They live in the home as their primary residence
- The home meets the HUD property standard
- The intending borrower has no outstanding federal tax liens
- They do not owe property tax for the last two years
You can contact our home equity experts to help you determine if you meet the eligibility requirements for a reverse mortgage.
Common Myths About Reverse Mortgage Information
Many people are family with traditional or “forward” home equity mortgages. But there is quite a bit of misconception when it comes to reverse mortgages.
We have compiled some of the common myths and also present the facts to help you get a better understanding of what a reverse mortgage is and how you can benefit from it.
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