When is a Reverse Mortgage Not Right in Cherryfield ME?
I have seen a lot of good that Reverse Mortgages have done for senior borrowers. I’ve seen them change lives and living situations for the better. I’ve seen people come out of foreclosure with a reverse mortgage and never have to make another mortgage payment. But is there a time when a reverse mortgage is NOT right in Maine? Honestly, yes.
There are a few examples I can think of off the top of my head for which I would advise a senior borrower not to get a reverse mortgage. Reverse mortgages are not inexpensive, if you did not intend to occupy the property much longer, that is, you thought you would move soon, I would advise against a reverse mortgage unless it was the only alternative you had to keep your home out of foreclosure in the mean time. Some married couples have one borrower old enough to take advantage of a reverse mortgage but the other spouse is too young.
In this instance, I see them wishing to quit claim the younger spouse off title to obtain the reverse mortgage. I don’t recommend this unless the older spouse is adequately insured so that if the older spouse passes, the mortgage can be paid in full. If not, the loan would be due and payable, and even if the younger spouse was now old enough to qualify for a reverse mortgage, chances are pretty good that he/she would not be eligible for a high enough loan amount to cover the old balance left by the reverse mortgage from the passing older spouse that has accumulated interest. In this case, if the younger spouse did not have adequate funds from another source to pay the mortgage in full, he/she would be forced to sell the home and would be displaced.
A Few More Good Examples for Citizens of 04622 in ME
I do not recommend a reverse mortgage to those whose health is so bad that they know there will not be at least one borrower able to stay in the home anyway (once all borrowers on the original loan are out of the home for a period of 12 months, which includes nursing homes, the mortgage becomes due and payable). There is no income qualification for a reverse mortgage, however, if you know that even with the relief you gain from a reverse mortgage you cannot afford the taxes, insurance and upkeep on your property, then I would suggest you look at other alternatives. Reverse mortgages require that the borrowers still pay all the taxes, insurance and maintain the property in reasonably good condition in Cherryfield 04622.
If your monetary needs are temporary, then the costs of a reverse mortgage may not make it the best option. Finally, if you don’t really even need a reverse mortgage and someone is trying to talk you into one, then talk to your trusted family members or financial advisor. It could be that the person trying to convince you is looking out for your best interests and wants to see you more comfortable or prepared for future events, or it could be that they have other motives and you need to really look at your circumstances and determine whether a reverse mortgage is right for you.
Reverse Mortgage Pros and Cons in Cherryfield Maine
Have you been looking at a reverse mortgage as a way of increasing your retirement income? Today, reverse mortgage loans have become a hot trend in the financial and mortgage world, but as attractive as they may first appear, there are important areas to look for. Here is a look at a few of the more important reverse mortgage pros and cons.
Reverse Mortgage Pros and Cons
One of the best parts to a reverse mortgage is the fact that it is a tax free source of money that can continue to come in month after month for as long as you live.
- A reverse mortgage loan will allow you to continue living in your home in 04622.
- You will also have the option in most cases of getting your loan funds in a lump sum payment, line of credit or as a monthly payment. Choose the payment option that will work out the best in your financial situation.
- You can get a reverse mortgage loan regardless of your current credit situation.
- Another excellent aspect of these loans is that you will never owe more than what the value of your home is. This means that if you end up receiving $200,000 over the life of your loan, but your home is only valued at $175,000, you will not have to come up with the difference. This includes your heirs as well in the even you pass away.
- Finally, payments received by you with a reverse mortgage loan program do not affect any Social Security or Medicare benefits.
- As with anything in life, there are some negative aspects to a reverse mortgage loan that you need to be aware of.
- A reverse mortgage will have fees and closing costs with it. Every loan broker or bank will be different in the fee schedule, but they all include these costs.
- You will lose the equity in your home with a reverse mortgage since that is how the loan amount is based. You will also need to maintain your home in good condition and be current on property taxes.
- You will need to obtain a reverse mortgage counseling class before getting the loan.
- The loan may have an effect on Medicaid and SSI benefits, although in most cases it will not. Each state is different in how they handle it.
- By understanding a few of these major reverse mortgage pros and cons you will be able to make a more well informed decision on whether to move forward with this type of loan program. It’s a serious decision that can have long lasting financial effects.
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