The reverse mortgage loan is designed for a senior, who urgently needs more disposable money and whose only asset is his home equity. This type of a person is called a cash poor but equity rich person. If he wants, he can borrow money against the equity and to utilize it how he wants.
As a wise reader understands to use the home equity in the form of the reverse mortgage is always a serious action, especially when it is the only asset. Those money have been saved in the course of a long period of time and the money is earned with the hard work. But when the need is a serious one, such as the amplified medical bills, then the loan is justified.
1. Do You really Need The Reverse Mortgage? That is a good question. The target is to make use of a part of the home equity and to turn it into the reverse mortgage loan. Once the money is used, it’ll never come back. Another view is, that the reverse mortgage is a long term commitment, it’s a loan, that works in a reverse way in comparison to the usual mortgage.
The need for more disposable money is human. That’s what almost everybody wants. Concerning the reverse loan you need to notice, that this loan type is a costly one, simply because of the costs it includes.
The costs differ lender by lender and state by state, which means you better ask the details from the lender or from the counselor.
2. Is Your Need An Urgent One? I repeat this question again and again, because this is a serious thing. If your need is to get money for a holiday or for a two week vacation on the cruiser, then the reverse mortgage is not the solution but you better find the wiser alternatives.
3. You can Cancel The Deal. After you have signed a reverse mortgage loan you have actually three days time to cancel the deal. This you can do for whatever reason. The three business days means all working days plus Saturdays but not Sundays. The cancellation must be done in a written form using the form a borrower got from the lender or by letter or fax.
4. How much can you get? There are differences between the states, however the amount depends on the appraised value of your home, on your age and on the interest rates. In most cases you can get the more the older you are, the expensive your home is and the lower the interest rates. The maximum amount is $ 625.000.