Reverse Mortgage FAQ - Lakewood WA Reverse Mortgage
Q: What is a Reverse Mortgage Loan? A: A Reverse Mortgage Loan is a type of loan that allows homeowners who are 62 years old or older to access the equity in their homes. Unlike traditional mortgages, the borrower does not make monthly payments to the lender. Instead, the loan balance increases over time and is paid off when the borrower moves out of the home or passes away.
Q: How does a Reverse Mortgage Loan work? A: With a Reverse Mortgage Loan, the borrower receives payments from the lender based on the equity in their home. The amount of the payments is determined by factors such as the borrower's age, the value of the home, and current interest rates. The loan balance increases over time as the borrower receives payments, and interest is added to the loan balance.
Q: Who is eligible for a Reverse Mortgage Loan? A: To be eligible for a Reverse Mortgage Loan, you must be at least 62 years old and own your home outright or have a low mortgage balance that can be paid off with the proceeds from the loan. You must also live in the home as your primary residence.
Q: What are the advantages of a Reverse Mortgage Loan? A: The primary advantage of a Reverse Mortgage Loan is that it allows you to access the equity in your home without having to sell your home or make monthly mortgage payments. You can use the funds for any purpose, such as paying off debt, covering medical expenses, or making home improvements. Additionally, you can continue to live in your home as long as you meet the loan requirements.
Q: What are the disadvantages of a Reverse Mortgage Loan? A: One disadvantage of a Reverse Mortgage Loan is that the loan balance increases over time, which can reduce the amount of equity you have in your home. Additionally, the fees associated with a Reverse Mortgage Loan can be higher than those of a traditional mortgage. Finally, if you do not meet the loan requirements, such as maintaining the property or paying property taxes, the loan can become due and payable.
Q: Can I lose my home with a Reverse Mortgage Loan? A: Yes, it is possible to lose your home with a Reverse Mortgage Loan if you do not meet the loan requirements, such as maintaining the property or paying property taxes. Additionally, if you move out of the home or pass away, the loan will become due and payable. If the loan balance exceeds the value of the home, the lender may need to sell the home to repay the loan.
Q: Can I leave my home to my heirs with a Reverse Mortgage Loan? A: Yes, you can leave your home to your heirs with a Reverse Mortgage Loan. However, they will need to repay the loan balance or refinance the loan to keep the home.
Q: How do I apply for a Reverse Mortgage Loan? A: To apply for a Reverse Mortgage Loan, you will need to contact a lender that offers this type of loan. The lender will evaluate your eligibility and provide you with information about the loan terms and fees. You will also need to participate in a counseling session to ensure that you understand the loan requirements and the potential risks and benefits.
Have a question on Reverse Mortgage's in Lakewood WA or in Washington State? Feel free to reach out to Kevin Tinsley at 253-472-1500 or kevin@alltechmortgage.com and setup an initial conversation.
* Specific loan program availability and requirements may vary. Please get in touch with the mortgage advisor for more information.