Advantages of a reverse mortgage

The main advantage of Reverse Mortgages is that you can eliminate your traditional mortgage payments and/or access your home equity while still owning and living in your home.

In good economic times and bad, the key advantages and benefits of reverse mortgages include:

• · Flexibility: Use the money any way you want or need.
• · No Downside: With a Reverse Mortgage you will never owe more than your home’s value at the time the loan is repaid, even if the Reverse Mortgage lenders have paid you more money than the value of the home. This is a particularly useful advantage if you secure a Reverse Mortgage and then home prices decline.
• · Tax Free: As a Reverse Mortgage is a loan, the money from it is typically tax-free, whether you receive it as fixed income or in a lump sum.
• · Federally Insured: The Home Equity Conversion Mortgage (HECM) is the most widely available Reverse Mortgage. It is managed by the Department of Housing and Urban Affairs and is federally insured. This is important since even if your Reverse Mortgage lender defaults, you’ll still receive your payments.
• · Proprietary Options: For higher value homes, there are several “jumbo” options available with higher lending limits ( up to 4 Million dollars ) and alternative fee structures.

Instead of pulling out equity by selling your home, a reverse mortgage allows you to continue living in your home payment-free. Yes, you read that right. Keep your home without paying your mortgage.

The amount of money that you can receive from a HECM depends on a number of factors, such as age, the type of reverse mortgage you select, current interest rates, and the appraised value of your home.