Cameron from Cape Cod, Massachusetts knew that he had some important decisions to make. His mother, whom at the time was 82, no longer had the cash to be able to do the things that she had loved to do throughout the course of her life. Cameron needed to find a solution so that she could keep her house and also have some extra cash on the side. His answer came from a government-insured policy known as a reverse mortgage. By taking out a loan using his mother’s one-bedroom condo as collateral, she could afford to have a comfortable amount of living expenses that she could hold on to. So Cameron decided to trust that this solution would give his mom the peace of mind that she longingly deserved.
Soon enough, his mom received around $80,000. What Cameron didn’t realize was that it yielded far more benefits that he thought possible. Over the years, Cameron’s mother funded her granddaughter’s education and sent her to college. The amount of happiness and hope that this simple loan gave to this family is priceless. If you’re considering a reverse mortgage, here are some important things that you should know prior to applying.
A reverse mortgage essentially uses your home as collateral, but, instead of making installed payments back to the lender, the lender pays you. There are eligibility restrictions however, as you must be 62 years of age or older to be able to take out a loan. Additionally, you must have paid off your home or have a low mortgage balance that can be paid off with the loan.
There is no credit check or verification of income with this type of loan. The amount that you will receive depends on a variety of factors that include: your age, the amount of equity in your home, and current market interest rates.
Upon approval, you’ll be able to receive the money in several ways. You can receive it in monthly payments, through a credit line, or in lump sum. Choose the one that fits how you’re going to spend the money that you receive. You can even receive the money through a combination of all three as well.
Reverse mortgages have been known to save homeowners from giving up the house that they’ve lived under for so many years. Due to the constant influx of living expenses coupled with the low amount of income streaming in, this loan can be the solution to them living the rest of their life in comfort and peace.