Reverse mortgages are loans made by homeowners 62 years old and above against their primary home. It can be considered a great opportunity because it extends advantages to whoever applies. A reverse mortgage lender in Santa Ana would be able to accommodate you for this type of loan, you may want to cover a few basics that would help you arrive at an informed decision.
Reverse mortgages are a form of tax-free income. There are no taxes levied upon this type of loan because you already own the equity you are tapping into. In order to qualify, you only would have to have title over the property in question and be able to comply with the age requirement (62 or older). It would also have to be your primary residence. There are no credit standing requirements and there are no evaluations that are based on a viable, steady income. You may use the amount loaned for whatever purpose may serve you. Use is totally dependent upon your choice. You can utilize the amount to augment your income, to help settle credit card, car and other loan payments. You may use it to purchase a second property. You can use it for medical needs. The full amount of payment is not due until one of three conditions apply such as your demise, the sale of the property or if the property ceases to be your principal residence.
The proceeds of a reverse mortgage can be received in any of varied modes. The first is as a lump sum amount. The second is in increments (term or tenure). The third would be as a line of credit. Lastly, it may be any combination of the aforementioned modes.
One of the many advantages of a reverse mortgage is that it would not affect your social security or Medicare privileges. Another is you are able to hold on to the property title in your name. However, as the owner of the property, you are mandated to take care of the real estate property taxes and you are also to take charge of property maintenance fees, utilities and insurance premiums. Being non-recourse, you will never owe above the value of your property.
What Makes You Entitled
You are very much entitled to this special opportunity of an income for which you can use for your purpose of choice. You may be contemplating on retiring in comfort being able to travel. If so, you can make use of your loan. It is also a cushion for when medical and therapy needs pile up. Or maybe you simply want to invest in another property or thinking of remodeling of your existing one. Whatever your purpose, you are entitled because of the equity that you have accumulated over time paying your monthly mortgages on your home.
If you are now sold on the idea of reverse mortgages and would like to benefit from one, you might want to take a look at a few tips to ensure a hassle free experience:
- Consult an authority on mortgages to clarify all concerns.
- Determine the type of loan release that you wish: lump sum, periodic, credit line or combination.
- Understand everything that a reverse mortgage might affect like your benefits and your estate. Make sure you are aware of the impact the mortgage may have.
- Ensure your discipline in covering for property expense such as insurance, taxes and utilities.
- Utilize the amount that you get wisely. Consider it as money you worked hard for.
- Remember that the older you are, the higher the amount you can loan.
- Make sure that you transact business with a reputable and trusted lender.