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| reverse_mortgage_help [2013/08/12 21:10] – created jan793 | reverse_mortgage_help [Unknown date] (current) – removed - external edit (Unknown date) 127.0.0.1 |
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| [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|Reverse mortgages]] are provided by a number of Australian banking companies to residential home owners aged 60 and above. This kind of mortgage is usually collateralized against the actual residence or an investment property. | |
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| Some of the advantages of reverse mortgages are as follows: A reverse mortgage can be considerably cheaper than selling or moving to a new home. Interest rates are usually lower than on traditional mortgages. You can receive a lump sum, monthly payments, or a line of credit. You would never need to repay a [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|reverse mortgage]] as long as you live in the home. There can be more options to consider and if you are looking for reverse mortgage help, your lender may be able to talk you through all of these options and provide you with all the necessary reverse mortgage tips. As a prospective borrower however, it may be important for you to consider how you will use the proceeds and whether it makes sense to receive the cash over time or all at once. | |
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| This last part is what makes a [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|reverse mortgage]] so attractive to elderly homeowners. Regardless of the outcome, no debt from the loan is passed on to the estate and subsequently the heirs of the homeowner. When researched properly, with the consultation of a CPA and involvement of the immediate family, a reverse mortgage can be an exceptional vehicle for supplementing retirement income through the home's equity. | |
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| Let's look at a couple things that might interest you right now. The first one is, basically, what is a reverse mortgage? And the second one is, what if you want to sell your home after obtaining a reverse mortgage? Both these questions lead to important considerations for all sellers now. Not every home owner is in a position to obtain a [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|reverse mortgage]], of course, since that legal financing instrument requires that the home owner has equity in his or her home at the time the reverse mortgage is put in place. Understanding the mechanics of a reverse mortgage is the first step to knowing whether it could work for your own situation. | |
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| Reverse Mortgage can provide you with a good cash flow, a special type of home loan that lets a homeowner convert a portion of equity in his or her home into cash according to U.S. Department of Housing and Urban Development (HUD). This website among others specializes in reverse mortgages. | |
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| * [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|Reverse mortgages]] are only available to senior citizens of 62 or above, while in forward mortgage there is no such age condition but it requires a firm income statement and job consistency. The conventional mortgage loan takes up the income while the reverse mortgage loan considers the value of the home. | |
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| -This is a common comment about Reverse Mortgages. But there are very few drawbacks. The biggest complaint is the cost, however almost half the cost is for the mortgage insurance that provides the safeguards put in place by HUD. | |
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| You must live in the residence for the [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|reverse mortgage]] at least 183 days out of the year. This isn't a problem for most people but it is a stipulation. If you won't be in that residence for that period of time then keep in mind that you will be violating the terms of your mortgage agreement. | |
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| Both the reverse and forward mortgages allow you to maintain the home ownership while you pay back the loan with interest. The only difference lies in the method of repayment. Here we've emphasized a few differences between reverse mortgage and a regular one: | |
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| * You have to make monthly installments while paying back a regular mortgage, this way you reduce debt and build up your home equity whereas with a reverse mortgage you don't have to make any sort of monthly payments, and the entire loan amount along with the interest has to be paid back when the homeowner dies, sells the home, or moves from it permanently. | |
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| Whenever you sell your home, either you or your estate on behalf of your heirs will be required to repay the cash you received in the form of monthly payments, plus interest and other fees, to the reverse mortgage lender. Any remaining equity in your home belongs to you or to your heirs. If there is no remaining value after the lender's equity, which includes the interest and fees you agreed to pay at the time you signed [[http://bellaterraip.wordpress.com/2013/08/12/reverse-mortgage-reverse-your-monthly-mortgage-payment/|reverse mortgage]] documents, the lender takes possession of the home in order to sell it. A current appraisal is used to determine the market value at the time of any sale, irrespective of the price a new buyer is willing to pay. | |