REVERSE MORTGAGES – Introduction

REVERSE MORTGAGES – Introduction

Older homeowners can tap into more of the equity in their homes with a reverse mortgage. If you're 62 or older you can use a reverse mortgage to tap into some of the equity in your home in the form of a loan without having to sell or give up title. Why would the older homeowner want to do this?

1) Needs to: retrofit the home to stay in it, cash to pay bills, add on an addition for visiting family to use or house a caretaker and other needs.
2) Enhanced lifestyle – funds are used to purchase things like a Recreational Vehicle, houseboat, or even a motorcycle.

The best feature: The loan doesn't have to be repaid until you move, sell or upon your death. When the loan is repaid, any remaining equity is distributed to you or your estate if deceased. In addition, the repayment amount can never exceed the value of the home. And because the money received is in the form of a loan, it's not considered taxable income, which means it won't affect your Social Security or Medicare benefits.

Borrowers can take the loan in the form of:
1) A line of credit, a lump-sum payment,
2) Fixed monthly payments or,
3) A combination of the above.


The amount of money you can borrow depends on your age, the current interest rate and other loan fees. It also takes into account the appraised value of your house and the mortgage limits for your area set by the Federal Housing Administration.

To determine how much you could borrow or just to learn more, read about it on these websites:
http://www.reversemortgage.org/
http://www.aarp.org/revmort

Information provided by:
H. Duane Cunningham
First Horizon Home Loans
Direct Line: (703) 728-4219
20098 Ashbrook Place # 250
Ashburn, VA 20147
www.firsthorizonusa.com/duanecunningham