Can I Afford Not to get a Reverse Mortgage in Texas?
With many of the basic costs of living on the rise it is tough to live on a fixed income. Things like healthcare, property taxes and energy are costing you more and more every day. You may need to consider ways you can preserve your current standard of living or even improve it. That is why it is so important to consider the reverse mortgage facts.
Think about it, just this week there were huge dips in the stock market. Things like investment portfolios and retirement accounts are under performing or pension plans that are being wiped out in some areas. These questions bring up the question: Should I opt for reverse mortgage? and Can I afford not to get one?
What is a reverse mortgage?
If you don’t know what a reverse mortgage is, it’s basically what it sounds like. With a traditional mortgage, you pay monthly for the mortgage until you pay it off. In a reverse mortgage, the mortgage company will be paying you instead. You can choose the way your monies are distributed to you, such as a Line of Credit, tenure payments or term payments or a combination of those.
The money you get from a reverse mortgage plan can be used to pay for your retirement, pay medical bills, property taxes, take a vacation, pay on credit cards or any of the bigger expenses on your list. There are generally no restrictions on how you use your money.
Reverse mortgages are basically a loan and therefore, the payments are not usually taxed. Plus the requirements for credit or income may be more lenient. Just stay in your home as your primary residence and the loan is not due until the last surviving spouse passes away.
So, should you consider a reverse mortgage? Let’s see.
The Costs Involved
The terms and conditions in a reverse mortgage can be complex and difficult to understand, but that is why we are here to help. There are different aspects that make up the cost. These include the title policy, mortgage insurance premium (MIP), real estate appraisal, survey fees (if needed), origination fee and recording fees. These fee’s are added to the loan just like a traditional mortgage. The only out-of-pocket fee’s is the HUD counseling and appraisal fee.
The good thing about all those steps is that you don’t need to know them. When you work with a professional, we make sure all the i’s are dotted and the t’s are crossed. We are here to help protect you and make sure you are informed.
What about Immediate Heirs?
Many people are concerned about what happens when their time here on earth is done. No need to worry. Your heirs will have up to one year to refinance the home or just simply sell it. Your heirs can still benefit from the remaining home equity, the amount left after the reverse mortgage.
Plus, any future appreciation, or how much the house increases in value, may offset some of the interest being added to the loan. It could be a beautiful win, win situation for you and for your heirs.
If your home is your primary residence and you have at least 50% equity in your home it may be a good time to consider a reverse mortgage. If you are at least 62 years of age, then you may qualify for a reverse mortgage, regardless of your credit score.
The amount you qualify for will depend on your age, the value of your home after an appraisal, and the interest rate. It is best to know all of the options available. We may be able to get you much more than you need and in doing so, you don’t have to use all the money at once. Use only what you need and keep the rest for you future plans.
If you want to know more about reverse mortgages, we’d love to show you how easy it is. Give us a call at 1st USA Reverse Mortgage and ask for your FREE packet and no obligation consultation. 800-676-5619. We look forward to helping you explore your options. Don’t hesitate to call us today.