What makes a Reverse Mortgage different from other home equity loans?
A reverse mortgage is a non-recourse loan and that means that the home is held as collateral and is responsible for repayment of the loan – not the borrower.
The interest rate of a reverse mortgage is locked in at the beginning of the process.
If it improves, the borrower gets the lower rate, but if the rate increases, the borrower is protected and keeps the initial interest rate.
Unlike other loans, no Principal and Interest mortgage payment is required.
The borrower can earn compound interest on their home equity and the growth on the equity is tax free.
When the borrower accesses the equity, it is not taxable
You choose to tap the home’s equity as a line of credit and the amount you can access increases over time.
Finally, you can stay to age 150, if you live in and maintain the home as your primary residence, pay the property taxes, homeowners’ insurance, and homeowners association dues.
To find out more about reverse mortgages call us today.
