That's fine, you just need to live in your primary residence for six months and a day.
It depends on what you do with your overall finances. Some families will receive more by being more efficient with the use of their portfolio of assets; however again, because this is not financial advice, it is very important that you consult with your financial advisor to make the best use of a reverse mortgage for your specific situation.
As long as you are simply rehabilitating and getting better, your home and reverse mortgage are still yours until two doctors agree it is impossible for you to ever return to your home.
Your reverse mortgage will become due when one of these things happen:
Yes, your reverse mortgage will not become due until you pass away, sell your home, or are no longer living in the home. If you use all of the available proceeds, you would not have any more money available and interest would accrue until one of the three events referenced above occurred.
Nothing as long as you still live in your home and pay taxes, homeowners insurance, and maintenance.
Most likely, it will decrease the amount of money the heirs will receive from the value of the home. However, your overall net worth will likely get better, because you will not be spending as much from your other accounts.
You remain the owner of your property. There is no change to the deed or title of your home when completing a reverse mortgage.
It depends on your situation. Our trained loan officers have helped hundreds of seniors pick the best option for their personal situation. You can do a lump sum payment, ongoing monthly payment, or you may also choose a line of credit allowing you to access your money as you need it. Your line of credit will be guaranteed to grow every year that you don't use it.
As long as you still have money available to borrow from your reverse mortgage, you can change your disbursement option for a small, one-time fee. Remember when the value of the loan is higher than the home value it does not trigger an early payoff or due date.
No, but for tax or cash flow purposes including Medicaid planning you may wish to do so.
The homeowner remains responsible for the payment of annual property taxes and homeowner's insurance as well as basic upkeep of the property.
If you do not continue to do these three basic things, the lender is required by HUD to foreclose.
The HECM will be held on the newly purchased home as your primary residence.
The down payment you will need to bring to closing will be determined based on your age, interest rates at the time and the sales price (or appraised value, whichever is less) of the home you are buying.
The money must come from your own liquid assets (bank accounts, CD's, retirement accounts, etc.) or from the documented sale of other assets you may have (your present home for example).
Your down payment is higher initially because you will never be required to make a monthly payment (except for taxes, insurance, and maintenance). With a traditional mortgage you would potentially lose more in cash flow over the years because of the consistent required payments. Remember the HECM for Purchase also can allow you to purchase a more expensive home than what you would otherwise be willing to commit to in payments for the next 20-30 years.
A reverse mortgage can be used to turn a portion of the equity in your home into cash that can be used for many different purposes that may enhance and extend your retirement. If you currently have a mortgage, a reverse mortgage could eliminate your mortgage payment (taxes and insurance must still be paid, and the home maintained), and also allow you to access any additional equity (over and above your mortgage balance), to create accessible cash which is not readily available while in the form of home equity. You have spent many years putting your money into your home equity, and now with a reverse mortgage, you may be able to convert some of that equity into tax-free cash.*
A reverse mortgage is the only type of mortgage that never requires a payment of principal and interest until the last surviving borrower passes away or moves out of the home, as long as all loan terms are met. You are always required to pay household expenses such as taxes and insurance, and maintain your home. If you take the reverse mortgage as a line of credit, monthly draws, or a lump sum, you will never be required to make a payment during your lifetime as long as you live in your home and meet all other loan terms. You always have the option to make a payment if you wish. If you choose to make a payment toward your line of credit, the money may increase your available funds in your line of credit.
When you permanently move out of the home, whether you sell it or pass away, neither you, your estate nor your heirs are responsible to pay the deficit if the balance owed on your reverse mortgage exceeds the home value. However, should your heirs want to keep your home, they may purchase it for 95% of the current appraised value.
*This advertisement does not constitute tax advice. Please consult your tax advisor for your specific situation. **There are some circumstances that will cause the loan to mature and the balance to become due and payable. Borrower is still responsible for paying property taxes and insurance and maintaining the home. Credit subject to age, property and some limited debt qualifications. Program rates, fees, terms and conditions are not available in all states and subject to change.
