What is a Reverse Mortgage?
However you’ve heard about reverse mortgages, from a friend or from a lender, it’s time to get the facts straight. Reverse mortgages are an important financial tool for many homeowners in retirement already or fast approaching.
These loans allow homeowners, over the age of 62, to convert some of the equity in their home into cash they can use. Plus, there are no restrictions on what the loan proceeds can be used for, it’s simply your money paid to you monthly or in a lump sum. Pay off your bills, lower your monthly expenses, or enjoy the vacation that you deserve with the knowledge that the loan won’t be due as long as you are living in your home.
Homeowners are also able to use the loan proceeds of a reverse mortgage to purchase a new home without having to deal with any payments. Borrowers can use a reverse mortgage along with the proceeds from selling a previous residence to relocate into a home that is closer to family or has less maintenance demands. These loans are an extremely powerful tool for retired homeowners and those over the age of 62.
Reverse mortgages are also known as “Home Equity Conversion Mortgages” (HECM). While not all Reverse mortgages are HECMs, the large majority is. Although not government loans, HECMS are insured and regulated by the Federal Housing Administration (FHA), which makes the loan safer and helps protect both borrower and lender. These loans can either have an adjustable or fixed rate, whichever you and your lender decide works best for you. However, before you get that far, there are some things you should know.
Obtain a Thorough Understanding
We understand that it can be difficult to decide if a reverse mortgage is the right choice for your family, so we are here to help. At CoastalStates Mortgage, our team of experts is ready to assist you each step of the way.
Our reverse mortgage specialists know all the ins and the outs and are prepared to help you discover if a reverse mortgage is right for you. Our experts will begin by walking you through the wide range of available reverse mortgage products and help you understand associated terms, benefits, and costs of each available option. We won’t make the choice for you, but we will give you all the information you need to make the best possible decision for yourself.
Counseling is Required
If you are serious about obtaining a reverse mortgage, it is required you attend a reverse mortgage counseling session with a Department of Housing and Urban Development (HUD) approved counselor. This session will answer many of the questions that you have, and ensures you understand all the benefits and the costs of a reverse mortgage. Your counselor will also advise you on any alternative programs or products that could also meet your needs. This unbiased counselor will review most of the points that your lender has already told you, and in many cases, this unbiased opinion will help you quickly reaffirm that a reverse mortgage is the perfect solution for your financial needs. You’ll have everything explained from what a reverse mortgage is to what it will cost you and how much money you will have access to.
After you’ve confirmed that a reverse mortgage is the right choice for your financial freedom, it’s time to select a lender and get started on your application. CoastalStates Mortgage has a team of reverse mortgage specialists ready to help you secure your financial future. Contact us to get started!