Three Facts About Reverse Mortgages

Anytime you apply for a loan or mortgage, you should understand what the financial obligation entails. Reverse mortgages in Las Vegas are loans against the current value of your home. Since it is a loan, it must be paid back.

Here are three facts about reverse mortgages to consider.

Who Qualifies for a Reverse Mortgage?

A reverse mortgage is a loan option available homeowners over the age of 62. It is designed to help seniors remain in their home during their older years. Most seniors live on a fixed income at this point of their lives, so if they can borrow against the equity of their home, it helps them remain comfortable in a place they know and are surrounded by their friends and family.

What Are the Advantages of a Reverse Mortgage?

Even though a reverse mortgage is a debt that must be paid back, there are several immediate benefits for the person who qualifies. It is common for individuals to use the funds to pay off any outstanding debts. This frees them up to create an emergency fund that covers anything from future medical expenses to burial fees. While it is true that you have borrowed against the equity of your home, your home remains in your name. It does not become the lender’s property.

How Is a Reverse Mortgage Paid Back?

When you are in a position to pay the loan from your reverse mortgage, you can sell the home and use those funds, or if you are in a situation where you have enough money to pay the loan back without selling the house, that is an option as well. If you pay back the reverse mortgage early, you do not incur penalties or additional fees. If you pass away, your heirs assume the debt and they decide how to best settle the debt.