As people get older and retire they start to hear different terms being used by their friends and neighbors within their same age group. One term you may hear from another retired homeowner is Reverse Mortgage Loan. When you hear it for the first time, you probably won’t know much about what it is or what it can do for you. If you’re interested in learning about what a reverse mortgage is and how it can help you, keep reading. By the end of this article, you should be more familiar with the subject.
What is a Reverse Mortgage?
A reverse mortgage is a loan that has gained its popularity among the retired senior community. Your home’s equity is used as collateral for the loan. The loan generally doesn’t have to be paid back until the last homeowner to survive moves out, or the inevitable happens. This is helpful to a senior couple where the loan won’t have the be repaid until both are no longer living in the home. Once that happens, there is usually a 6-month time period allotted for repayment of the loan. During the time of the loan, however, regular payments will be dispersed to the homeowners. These payments aid in supplementing the retirement income.
Who Would Benefit from a Reverse Mortgage?
A reverse mortgage is beneficial to any retired senior who meets the requirements to obtain one. Many retired seniors find themselves worried after they stop working that their savings for retirement will only go so far and won’t last for the rest of their lives. That’s where the reverse mortgage comes in. If you put your home’s equity up as collateral, you can get regular payments that will add to your savings and help with everyday living expenses. Getting a reverse mortgage can reduce the stress involved when you’re looking at your savings and unsure of how long it will last.
If you’re a senior retired homeowner, you may begin to have the money stresses making you question if your retirement savings will last the duration of your life until the inevitable happens. A reverse mortgage can assist in minimizing your worries and give you the ability to earn a regular income to help with providing your daily living costs. While your home is your collateral, there is no obligation for the loan to be repaid until 6 months after you move out or your passing. If it’s the latter, the repayment should come directly out of your estate as outlined.
If you’re interested in a reverse mortgage loan, consider contacting the team at Longbridge Financial.
