If you are a senior living in Tennessee 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 Tennessee 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 Tennessee 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.
Private Reverse Mortgage in Tennessee
The high costs related to reverse home loans seems to be one of the most significant arguments against securing a reverse mortgage, one should remember that the cost of selling a house, which might consist of major repairs in addition to the real estate commission and closing expenses, will practically constantly be greater than the cost of remaining in the house and obtaining a life time stream of earnings for as long as you remain in the home. Furthermore, it needs to be noted that the closing costs are not an expense expenditure, the expenses are funded into the loan, and not paid up until the loan is paid off at the time the property owner permanently leaves the home.
Educating yourself or a family member about a reverse home mortgage is the only method to genuinely learn if a reverse home mortgage is ideal for you or an enjoyed one. Every senior that wishes to look for a reverse home mortgage should go through a no charge HUD therapy class to be sure that they entirely comprehend how the reverse mortgage works and exactly what other options might be offered to them. safeguards have been implemented by the government, given that the first reverse mortgages were presented in the 1980's. Today's reverse mortgages are safe and offer self-reliance and improved way of lives to many "house rich and money bad" senior property owners. In depth details on reverse mortgages can be discovered online.Reverse Mortgage Broker | Reverse Mortgage Hud