1. What is a reverse mortgage?
A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that built up over years of home mortgage payments can be paid to you.
2. Do I qualify for a reverse mortgage?
To be eligible for a reverse mortgage, the homeowner must be 62 years of age or older, own home outright, or have a low mortgage balance that can be paid off at closing with proceeds from the reverse loan, and you must live in the home.
3. What’s unique about a reverse mortgage?
You cannot be foreclosed or forced to vacate your house because you “missed your mortgage payment.”
You don’t make loan payments, because the loan is not due as long as the house is your principal residence.
The reverse mortgage pays you, and is available regardless of your current income. The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home.
4. How much money can I borrow?
The amount you can borrow depends on your age, the current interest rate, and the appraised value of your home or FHA’s mortgage limits for your area, whichever is less. Generally, the more valuable your home is, the older you are, the lower the interest, the more you can borrow. You can use an online calculator like the one on the AARP website to get an idea of what you may be able to borrow.
5. How do I find out more information?
Call 1 (800) 569-4287 toll-free, for the name and location of a HUD-approved housing counseling agency near you or click on the following word: “Reverse Mortgage.”
Take care and good luck.