If you are thinking about a reverse mortgage; it is important to have some vital information about the process. The reverse mortgage can be used to help you access some of the equity in your home. Many of people use it to improve their homes, meet some unexpected expenses or even to supplement social security.
You will need full information about the mortgage before you decide whether it is the best option for you. The thing is to make sure you understand it before you decide whether it is what you want. A a reverse mortgage is a type of loan that you get on top of the existing home mortgage. The mortgage is different from others in that you are not obligated to start repaying he mortgage immediately unless you stop using the home as your residential place or you fail to meet your mortgager obligations.
The other important information is on who qualifies for such a loan? The first thing is to be a homeowner and one who is sixty-two years of age and above. You need to either be an outright homeowner or with a low mortgage balance. The other requirements are that you must be living in the house, the balance should be low such that is can be settled with the reverse loan, and also you must show evidence of income that will enable you to pay the new loan.
You do not have to have purchased your house using insured mortgage in order to qualify for this kind of loan. You may be asking yourself whether your kind of home can qualify for this kind of loan. You need to be a single family occupier of the home for you to qualify. You may be interested to know what is the difference between a reverse mortgage and a home equity loan.
What happens with a home equity, the borrower must make monthly payments on the principal and the interest. The the borrower will also be expected to pay the taxes, the insurance and the utilities. what you may also be interested to know is that in case you want to sell the house while you still have the loan, you must clear all the loan balance at the time of selling. That means before you can transfer the house to the new buyer, you must clear your mortgage. If you have left the house to your spouse or heir, then on selling the house, they will need to repay the loan and the remaining balance shall be for their use. The amount for each borrower is different depending on some factors. The the first factor that affects the amount is the age of the person acquiring. The no eligible spouse is another factor that can affect the amount.