I meet with senior homeowners that are thinking about getting a reverse mortgage. Would it be a good idea to sign up for a reverse mortgage? Could the government take my property? Who will be on title, me, the lender, the government or all of us? These are definitely legitimate questions. With many choices in life, you need to determine what makes the most sense. Making a decision about a reverse mortgage is no different. In order to assist you in your fact gathering quest I have included a huge amount of information for you.

Check out these other pages: Rancho Cordova, Soudan, Mayhew, Citrus

Benefits of Reverse Mortgages: (also called HECM – heck-uhm)
Additional cash flow guaranteed by the Government which continues as long as your home is your primary residence. You can learn more about your options with a reverse mortgageĀ  here.
You are not stuck with the decision you initially make. You can make changes to the way you obtain equity from your home at any time, assuming equity remains. One of several awesome features concerning the line of credit it that the unused portion of the credit line grows at the current rate plus 1.25%. An outstanding choice for those that wish to stay in there home.
Relocating can result in emotional problems for many senior homeowners. Memories were made inside your “home sweet home”, and close proximity to loved ones and remaining in your town may be a better option.
You do not have to own you home free and clear to qualify for a reverse mortgage. Almost all of the closing costs can be lumped into the loan with the exception of the counseling fee and appraisal.
You can not be evicted from your home as long as you are abiding by the agreement in the contract. Mainly these agreements include maintaining your home and paying your taxes, insurance and HOA dues.
You can refinance out of the reverse mortgage in to a traditional loan assuming you meet the requirements and there is equity in your home.
Upon the sale of your home you won’t ever owe more than the home is worth.
This is what known as a non-recourse loan. In other words, you have no personal responsibility for this loan, neither does your estate or your heirs.
Reverse Mortgages have many safeguards: capped mortgage rates, a restriction on fees, HUD counseling, asset protection (non-recourse loan), no maturity date (cannot become due within a homeowner’s lifetime).
Might be a financial tool to help beneficiaries avoid some of the real estate tax.
Your beneficiaries may be able to claim the interest from your mortgage on their income taxes after your death. (Make sure to consult your income tax advisor for information.)

Those were the pros, the good things. Pretty easy, right? Sure, the dutiful old loan officer always gives you the good parts, but there are some things that may be drawbacks to Reverse Mortgages. Here are the cons:

The CONS of Reverse Mortgages:
They can and often are higher priced than a traditional loan. However, you can not really compare them as they are different loan products.
A Reverse Mortgage can reduce your kid’s as well as grandchildren’s inheritance. Since you do not make payments with a reverse mortgage, you loan balance grows over time. As you loan balance grows it slowly eats up your equity. It’s the complete opposite of a conventional mortgage where equity will increase as mortgage payments are paid.
Selling your home can often provide a higher bang for your buck than a Reverse Mortgage.
These loans really do not make sense if you are planning on moving in the future.
If you fail to pay your real estate taxes or homeowner’s insurance or aren’t able to maintain the home, the bank may require repayment of the debt. (Lenders, however, will work with you to cure the default.)
The bank can also begin the foreclosure process if you have not lived in the home for Twelve consecutive months.
You might not be entitled to needs based programs and support such as Medicaid.

When NOT to obtain a Reverse Mortgage:
For those who only need short-term access to cash and capital.
{When your primary objective is fixing up your home, a community gift may work much better.|If you just need to add a roof, windows or other energy efficient options. If that is the case, funds and assistance might possibly be available. Go here for more reverse mortgage information.
Once you know you are likely to be moving to an assisted living facility in the very near future.
When family members believe that a senior reverse mortgage isn’t really a great choice, consider their recommendations and preserve an objective balance; they have your best needs in mind.
If your children invite you to move in with them, this might be a wonderful solution to staying in your own house.
A homeowner whose home uses more than 25% of the total livable space for their home business isn’t going to be eligible for an FHA Reverse Mortgage.