How do I receive proceeds of a Reverse Mortgage?
Reverse Mortgages - How do I receive the proceeds of my Mortgage?
By Nancy Woodward
There are several ways for you to obtain cash from your home using a reverse mortgage without having to repay the loan at all. When you obtain a normal mortgage, you decrease your loan thereby decreasing your liability and increasing your equity. Since this type of mortgage(Reverse Mortgage) works exactly the opposite of a normal mortgage, it essentially increases your liability to the lender and decreases equity in your home.
Four ways to receive the proceeds of your loan:
1. Lump sum - You can take all of the money at one time in a single lump sum of cash.
2. Cash advance – You can take a regular cash advance – i.e. monthly
3. Credit line - You can use an account that will allow you to take cash when you want it up to a maximum amount.
4. Using one or more of the above ways – this gives you the freedom to choose when and how much you want to take. This way can be used to effectively reduce the interest added to the balance of your loan.
After you qualify for your loan and receive funds, no one will have to repay this loan until you die, sell your home, or move out of your home on a permanent basis. You will have to qualify for the loan:
1. You must own your own home
2. You must live in this home
3. You must be 62 years of age or older.
4. Generally you must not have a mortgage loan on your home – generally Reverse Mortgages must be the ‘first’ mortgage.
While Reverse Mortgages can help you remain in your home, you are still the property owner. This means you must pay your property taxes and homeowner insurance, and making repairs on the property.
While you cannot have another first mortgage, it is possible to pay off existing debt, both in your home and credit debt, and with the money you obtain from your Reverse Mortgage proceeds.
As Americans are aging, society is seeking more ways to help them maintain their lifestyles by remaining in their home as long as possible. This is a way homeowners can obtain the necessary income without additional expenses.
As in any financial arrangement, I suggest you do your due diligence. Investigate the subject, talk to your attorney and perhaps your relatives and friends prior to moving forward.
By Nancy Woodward
There are several ways for you to obtain cash from your home using a reverse mortgage without having to repay the loan at all. When you obtain a normal mortgage, you decrease your loan thereby decreasing your liability and increasing your equity. Since this type of mortgage(Reverse Mortgage) works exactly the opposite of a normal mortgage, it essentially increases your liability to the lender and decreases equity in your home.
Four ways to receive the proceeds of your loan:
1. Lump sum - You can take all of the money at one time in a single lump sum of cash.
2. Cash advance – You can take a regular cash advance – i.e. monthly
3. Credit line - You can use an account that will allow you to take cash when you want it up to a maximum amount.
4. Using one or more of the above ways – this gives you the freedom to choose when and how much you want to take. This way can be used to effectively reduce the interest added to the balance of your loan.
After you qualify for your loan and receive funds, no one will have to repay this loan until you die, sell your home, or move out of your home on a permanent basis. You will have to qualify for the loan:
1. You must own your own home
2. You must live in this home
3. You must be 62 years of age or older.
4. Generally you must not have a mortgage loan on your home – generally Reverse Mortgages must be the ‘first’ mortgage.
While Reverse Mortgages can help you remain in your home, you are still the property owner. This means you must pay your property taxes and homeowner insurance, and making repairs on the property.
While you cannot have another first mortgage, it is possible to pay off existing debt, both in your home and credit debt, and with the money you obtain from your Reverse Mortgage proceeds.
As Americans are aging, society is seeking more ways to help them maintain their lifestyles by remaining in their home as long as possible. This is a way homeowners can obtain the necessary income without additional expenses.
As in any financial arrangement, I suggest you do your due diligence. Investigate the subject, talk to your attorney and perhaps your relatives and friends prior to moving forward.
Labels: real estate investing advice, real estate reverse mortgage loan, real estate reverse mortgage loan advice
posted by Nan at 12:44 PM
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