What happens to my home when I pass away or if I move?
The only payment on this type of loan is due when you move out or pass away. If you pass away, the home can be sold and the loan will be repaid with that. Or the person who inherited the home can choose to repay the loan and keep the home. If the loan exceeds the amount the house is able to sell for, FHA insurance will generally cover the difference.
How much money can I borrow?
The amount of cash flow you can get in a reverse mortgage depends on a few different factors. You can qualify for a higher loan amount if you are older and own more equity in your home. In addition, the value of your home and current interest rates also affects the amount you can receive.
What are the risks to a reverse mortgage?
Reverse mortgages mean you are borrowing money using the equity you own in your home. This can impact your inheritance since the loan is paid when you move out or pass away. In addition, there are conditions in a reverse mortgage, requiring you to pay your property taxes and home insurance. Since it is crucial to understand the terms and conditions, working with a reputable mortgage loan company can ensure that you understand everything before making important decisions.