What you need to know about a reverse mortgage
Retirees who are mortgage-free but cash-strapped often consider a reverse mortgage as a solution. As your lawyer, we cannot offer financial advice and highly recommend you seek the services of a financial advisor. Here are some key points to consider before pursuing this option;
Eligibility for a reverse mortgage varies depending on individual circumstances, including the borrower's age, home ownership status, and loan repayment terms. Consulting a licensed financial advisor is a crucial MUST before committing to a reverse mortgage.
To qualify for a reverse mortgage, you typically need to be sixty years old and own your home outright or have a significant portion of your mortgage paid off.
The amount that can be borrowed through a reverse mortgage is influenced by several factors and seeking advice from a mortgage expert is recommended.
Reverse mortgages can be used to supplement income, make large purchases, settle debts, or fund various expenses. The flexibility of using the funds for different purposes is a key advantage.
It's important to be aware of the fees associated with reverse mortgages, including property maintenance requirements, undisclosed fees added to the loan balance, and the impact of compound interest on equity over time.