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Are You Applying for a Reverse Mortgage? Here Are 3 Considerations You’ll Need to Make

December 31, 2020 by Nosari Home Mortgage, Inc.

Are You Applying for a Reverse Mortgage? Here Are 3 Considerations You'll Need to MakeIf you’re a homeowner who is looking to tap in to the home equity that you’ve spent years building you may be interested in a “reverse mortgage” or “home equity conversion mortgage”. While these unique financial tools aren’t for everyone, if you qualify for a reverse mortgage you’ll find that this might be the perfect financial solution which allows you to pay off your existing mortgage, or for some other regular expenses that you have.

Let’s take a closer look at how reverse mortgages work, including how to qualify, what happens to your existing mortgage and what a reverse mortgage might cost.

Do You Meet the Requirements for a Reverse Mortgage?

In short, a reverse mortgage is a type of home loan in which the lender pays you monthly payments or a lump sum based on the equity that you’ve built up in your home. At some point in the future – when you move out of the home, or pass away – the reverse mortgage loan will become payable.

As mentioned above, reverse mortgages aren’t for everyone. You’ll need to be at least 62 years of age and be a homeowner who has enough equity built up in your home to qualify. You’ll also need to understand that your lender will scrutinize your current financial position to ensure that you can keep up with property taxes and other regular costs that you may incur.

What Happens to Your Existing Mortgage?

If you have a regular mortgage it’s still possible to qualify for a reverse mortgage, but you’ll need to use some of the proceeds to pay off your existing mortgage. For example, if you have $50,000 owing on your mortgage and you receive a reverse mortgage for $100,000, you can pay your initial mortgage off and still have $50,000 to use as you see fit.

Do You Know What a Reverse Mortgage Costs?

Keep in mind that like a traditional mortgage, a reverse mortgage has costs attached. You’ll need to pay mortgage insurance premiums, service fees, lender fees and other third-party fees that are typically referred to as “closing costs”.

Learn More About Your Reverse Mortgages Options

A reverse mortgage can be an excellent way to take advantage of the equity that is currently locked up in your home. To learn more about reverse mortgages, contact your local mortgage professional and they’ll be able to share their guidance and expertise.

Filed Under: Home Mortgage Tips Tagged With: Home Mortgage Tips, Mortgages, Reverse Mortgages

3 Completely False Myths About Reverse Mortgages That Need to Be Debunked

January 9, 2018 by Nosari Home Mortgage, Inc.

3 Completely False Myths About Reverse Mortgages That Need to Be DebunkedAre you a senior or retired individual older than 62 who is looking to supplement their retirement income? If so, you may have heard about a unique financial product known as a reverse mortgage. In today’s blog post we will explore three myths about reverse mortgages and share why they need to be debunked. Let’s get started.

Myth #1: Reverse Mortgages Are Expensive

The first myth we will debunk is that reverse mortgages are costly financial products that are full of fees. In fact, nothing could be further from the truth. It’s true that there are closing costs attached to a reverse mortgage, just like with a traditional mortgage. These costs will vary depending on a wide range of factors, including the terms of the reverse mortgage, your financial history, your home’s location, size, assessed value and more.

If you are interested in a reverse mortgage, don’t let the potential fees or closing costs scare you off.

Myth #2: Children Inherit The Reverse Mortgage Payments

Many people believe that they are saddling their children with a mortgage payment when they take out a reverse mortgage, but this isn’t true. After you (and your spouse, if you have one) move on, whoever is overseeing your estate will have the option to sell your home and use the proceeds to pay off the balance of the reverse mortgage. Alternatively, they may decide to use cash to pay off the balance and keep the home. But your children aren’t going to inherit a monthly repayment.

Keep in mind that having a plan for your estate and a proper will is important, regardless of whether or not you have a reverse mortgage. Be sure to contact an attorney who is skilled in estate law for more information.

Myth #3: The Bank Ends Up Owning Your House

Finally, some believe that the bank will end up owning your home if you take out a reverse mortgage. This isn’t true either. With a reverse mortgage, you are borrowing money against the equity or value that you have built up in your home. You will continue to own the house, but the lender may place a lien against it to secure the mortgage loan.

These are just a few of the many myths about reverse mortgages that you might hear about or read online. When you are ready to learn more about this type of mortgage, get in touch. Our team of mortgage professionals is here and ready to assist you.

Filed Under: Home Mortgage Tips Tagged With: Home Mortgage Tips, Mortgage, Reverse Mortgages

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Chris Nosari


Nosari Home Mortgage
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