Reverse Mortgage | Did You Know You Can Purchase A Home With A Reverse Mortgage?
Qualifications For A Reverse Mortgage.
I receive a lot of questions about reverse mortgages. The first one always is, “What is a reverse mortgage.” What happens when the money runs out? There is too much wrong information on reverse mortgages. People often believe the house is no longer theirs or that their children’s inheritance disappears after a reverse mortgage.
A reverse mortgage usually is used as a means of income for retirees. A reverse mortgage is for the consumer who is 62 years old or older. It can provide guaranteed income during retirement.
The Benefits Of A Reverse Mortgage
The benefit of a reverse mortgage is that it can stop the mortgage payments. You would only be responsible for the taxes and the insurance on a monthly basis. Halting the mortgage payments is available, but you need some equity to be able to do it.
Sometimes I sit with families, and they’re only making $2,000 a month on Social Security. They struggle every month to make a mortgage payment.
A Great Story About A Grandmother I Helped.
Let me give you a perfect example. I did a reverse mortgage for this client about six months ago. She sold her home for $350,000 net in her pocket after everything was done. She wanted to live near her grandchildren. However, her grandchildren lived in an area that cost $450,000 for a house. And She’s short a hundred thousand dollars. So, what do we do? Here’s what I worked out based on her age and based on the money she had. I worked it out so that she put $200,000 into the purchase and she still had a $150,000 sitting in her pocket. She bought a $480,000 house and guess what? No mortgage payments! She had a $150,000 left, has no mortgage payments, and only has to pay the taxes and the property insurance. She gets to live near her grandchildren. What an excellent, incredible deal. Sometimes a reverse mortgage purchase is right for you.