Reverse mortgages are a financial agreement set up that requires a homeowner to relinquish equity in their home in order to receive regular payments, which are usually on a monthly basis. Typically this type of mortgage is used to supplement the income of retirees. While traditional mortgages decline as payments is made on the loan balance, with reverse mortgages there is a rise over time as the interest on the loan accrues.
While many aging homeowners consider reverse mortgages as an additional source of income, there are many pros and cons of this type of loan that a homeowner must consider before signing a contract to come to this agreement. The staff at Kloze is highly qualified and ready to answer your questions to help you make the best decision today.
Benefits of a Reverse Mortgage
Some benefits of Reverse Mortgage Loans are the added options they provide for senior citizens to live comfortably in their elder years. Many times their retirements and social securities are just not enough to live out their retirement in the way that they had envisioned for themselves. This added income has been known to go towards home improvements, dream vacations, unexpected medical expenses, and lavish club memberships to name a few.
Many homeowners ages 62 and older chose this option over a home equity loan because a reverse mortgage pays you. With a reverse mortgage, there is no tedious monthly principle and interest payment. Reverse Mortgages can also be used to purchase a primary residence for the borrower if they have enough cash on hand to pay them the difference between the Reverse Mortgage income and the combined sale price of the home with the closing costs.
Another benefit of Reverse Mortgages is that you can still qualify for this great program even if you did not purchase your home with an FHA insurance program. At the time of sale or when the home is no longer occupied as a primary residence, all additional proceeds outside of interest and finance charges are paid out to the spouse or the estate. One great advantage of this program is that any remaining equity can be transferred to the heirs of the estate, and no debt is passed along to the estate or heirs.
Drawbacks of a Reverse Mortgage
Some homeowners encounter obstacles when engaging in the processing of obtaining a reverse mortgage. If the borrower of the loan decided to no longer use the home on the loan as their primary residence or if they default on their obligations to their mortgage, then they are subject to the terms of paying back the reverse mortgage loan. Additionally, the loan holder must own their home outright or have a mortgage balance that is significantly low and can be paid off at closing with the revenue from the reverse loan.
Reverse Mortgage borrowers must also be responsible for the ongoing charges of the property including all taxes and insurance fees. Dwellings that are approved for reverse mortgages are limited to single family homes or 2-4 unit homes as long as one unit is occupied by the borrower on the loan. Once the home with a Reverse Mortgage is sold or no longer used as a primary residence, all interest, cash, and other Reverse Mortgage finance charges must be repaid with the proceeds.
Financial Stability for a Prosperous Future
For Fort Lauderdale reverse mortgage rates, look no further than NHL Lending in Fort Lauderdale, Florida. Our staff is highly qualified and has extensive experience in helping you obtain the best loan for your needs. Our reputation is unsurpassed in our industry, and we are fully equipped to meet your needs. We are readily available to answer all your questions and help you fully understand the terms and conditions of your loan. Retirees have been turning to reverse mortgages as a popular source of income for decades and have been experiencing the financial freedom they deserve for their golden years. For the most competitive Fort Lauderdale Reverse Mortgage Rates call our qualified staff today at Kloze today. We look forward to helping you make your retirement a dream come true.