About Reversed Mortgage

Reverse mortgage is designated to provide senior citizens with the right solution when they need a stream of cash flow to keep the life the lead. When reaching to an age where you can not work and increase your income and you need money for your daily life, the property you have can give you the right to have a reversed mortgage while you can still live in the house without having to change your life style. This option is good for those who can not raise money from resources such as family, savings, assets, etc



A reversed mortgage can also suit people who want to move to a house that is more compatible with their retirement life style. A reversed mortgage can help them reach their goal. Elderly people who reached the point where they are no longer pay the initial mortgage can turn to lenders for a request for a reversed mortgage.



The rational behind this kind of loan is that it provides you accesses to cash flow without having to sell your house or taking a new loan against your house, a loan that is likely to be with less attractive terms and conditions. Also, the main advantage of a reverse mortgage is that there are no monthly payments.



The way this mortgage is purchased is by using a few factors: the age of the youngest person among the couple (the youngest borrower) and the value of their house. In United States the minimum age for having the right to get a reversed mortgage is 62. in both cases, a loan for buying a new house or a loan when staying in the house, the borrower does not have to make a monthly mortgage payments as the debt will be covered only after leaving the house.



After the death of the borrower, the successors will be responsible for paying the debt for the loan lenders. Thus it is important to consult them and let them know beforehand that you are going to do this step. Keeping a life insurance may be used for paying the reverse mortgage but of course the house itself should be the main source to cover the loan. Setting up such a loan also bears costs and fees, that should be taken into account as they are not insignificant.