Are you wondering if a reverse mortgage loan is right for you, but unsure of what they are? Don’t worry! This FAQ section answers some of the most common questions and provides key information and reverse mortgage facts.
At Waterstone Mortgage, we specialize in offering reverse mortgages for senior citizens throughout the state of Virginia. As a local reverse mortgage company, we emphasize educating seniors and helping them understand the facts about reverse mortgages. By doing so, they will get to know if this arrangement is the right tool for their financial future. For more information on our services or to learn more reverse mortgage information, you can reach us at 434-529-8421 or get in touch with our team online.
Your Guide to Reverse Mortgage Facts & Myths
If you are considering whether a reverse mortgage might be right for you, it is important to learn some key reverse mortgage facts. Here are some common questions about reverse mortgages:
What Is a Reverse Mortgage?
A reverse mortgage is a financial tool available to homeowners over age 62, allowing them to convert their home equity into cash. The best part of this plan is that you do not need to make monthly loan payments, unlike traditional loans. Plus, with a reverse mortgage, you can retain the ownership of the home and continue to hold the title and ownership throughout the loan period.
Am I Eligible for a Reverse Mortgage Loan?
If you are a homeowner above the age of 55, a reverse mortgage loan is for you. Having said that, some product types require you to be 62 or older. Your reverse mortgage company can help you understand the eligibility requirements and which type of loan is right for you.
How Does a Reverse Mortgage Work?
Similar to a traditional HELOC, a reverse mortgage uses your home as collateral or financial security for the loan. The loan balance increases over time as interest accrues, and you have to repay this amount when you no longer live in the home. This is the opposite of how traditional mortgages work, where you have to make monthly mortgage payments to clear the loan.
How Much Amount Do I Qualify For?
The amount you qualify for depends on multiple factors like age, the value of your home, the present interest rates, and the type of reverse mortgage you opt for. All these factors determine the amount you can get.
How Will I Receive My Cash?
With a reverse mortgage, you can receive cash in several ways. Here are the common distribution methods:
- Lump sum
- Monthly payments
- Line of credit
- Combination of the above options
The amount and the pace at which you receive funds depends on the type of distribution method you choose.
What Happens At The End Of The Loan?
At the end of the loan, the repayment period starts. This happens when the homeowner moves out, passes away, or sells the property. It is important to note that a reverse mortgage is a non-recourse loan, which means that you (or your heirs) will never owe more than the value of your home when the loan becomes due and the home is sold.
Is Reverse Mortgage Right For Me?
A reverse mortgage is not for everyone. It is designed for homeowners who are above 55 or 62 (depending on the product) and own their home outright or have established equity in their property. To know if a reverse mortgage is right for you, you should assess your financial situation, consider your long-term housing plans, and recognize the implications of a reverse mortgage.
Can The House Be Sold After Taking Reverse Mortgage Loan?
Yes, you can sell your house after taking a reverse mortgage loan. All you need to do is repay the loan amount and the interest at closing.
Will You Be Kicked Out Of The House?
No, you will NOT. A reverse mortgage loan doesn’t kick you out of the house. You will retain the ownership and the title of the house throughout the life of the loan.
Contact Us Today for More Reverse Mortgage Facts & Information
If you think a reverse mortgage might be right for you or you want to learn all of the reverse mortgage facts, we can help. Call Waterstone Mortgage at 434-529-8421 to schedule a free consultation and review with our local agents. Based out of Charlottesville, VA, our team is dedicated to offering personalized assistance to seniors throughout the local area and answering all your questions about reverse mortgages. Pick up the phone and call us today.
