How a Reverse Mortgage Works
Senior citizens on a fixed income today are asking themselves “how does a reverse mortgage work?” This article will hopefully clear up some misunderstandings as to how a reverse mortgage works.
Simply put, a reverse mortgage is a special loan program available to senior homeowners aged 62 and over. The uniqueness of a reverse mortgage is the homeowner’s ability to receive money from the lender without interest, instead of making payments to the lending institution through a conventional home loan. There are typically three ways to receive this money: by means of a lump sum, a series of payment installments, or as a line of credit that can be drawn upon at any time.
A reverse mortgage loan is only required to be repaid when the home is no longer occupied by you or your spouse. This repayment is usually accomplished through the sale of the home. Once the home has been sold and the reverse mortgage balance has been paid in full, any remaining proceeds go to you or your estate. Essentially, with a reverse mortgage loan, you are allowed to remain in your house until you either pass away or vacate, upon which the remaining amount of the loan must be paid in full. The hope is that you will have continued to build equity in the home in order to not only pay off the loan, but realize some money after the sale for yourself or your estate. Read full article plus other quality reverse mortgage loan articles at http://www.EliminatingDebtForever.com
Last modified February 9, 2010Author 3008 > has blogged 7 times
