If you are a senior living in Missouri looking to raise finance to help in retirement, you may have heard the term reverse mortgage. There is still a lot of confusion and misconceptions surrounding this financial product. Here we answer the question "What is a reverse mortgage?" After reading this you should be able to decide whether this is an option that is worth pursuing.
A reverse mortgage allows you to turn the equity in your Missouri home into cash. It is only available to people aged 62 or over, so it tends to be used by retirees as a way of supplementing their income.
You can receive payment by way of a cash lump sum, a line of credit or a monthly income. The attractive thing for many customers is that there are no monthly payments to make, unlike a normal mortgage. The money that is drawn down is tax-free.
There are many baby boomers coming up to retirement that are realizing that the amount of income that they are going to receive during their retirement is not going to be sufficient to live on. This has led to there being a big increase in interest in reverse mortgages.
The money raised can be used for any purpose. This includes supplementing existing Missouri retirement provisions, paying for medical care or carrying out modifications to the house such as installing a ramp or downstairs shower. You could even use the money to go on a holiday of a lifetime or buy a new car.
While this sounds very attractive, are there any downsides to a reverse mortgage? The main one is the amount of equity in the property will be reduced when you come to sell it. This maybe important to you if you were planning on having your children inherit your house.
There are plenty of helpful resources available to you to further learn about reverse mortgages. You can choose to speak to housing counselor or find resources online.
Reverse Mortgage Age in Missouri
The high expenses related to reverse mortgages seems to be one of the biggest arguments versus securing a reverse mortgage, one need to keep in mind that the expense of selling a house, which might consist of major repairs in addition to the property commission and closing expenses, will usually be higher than the cost of remaining in the home and obtaining a life time stream of earnings for as long as you remain in the house. Furthermore, it needs to be noted that the closing costs are not an expense expense, the costs are funded into the loan, and not paid till the loan is settled at the time the homeowner completely leaves the home.
Educating yourself or a family member about a reverse mortgage is the only method to genuinely find out if a reverse home loan is best for you or a loved one. Every senior that desires to apply for a reverse mortgage needs to go through a no cost HUD counseling class to be sure that they entirely understand how the reverse mortgage works and what other options may be offered to them.Reverse Mortgage Broker | Chase Reverse Mortgage