When a retired home owner has an emergency or needs a little cash, there are some things they could do. For some, they could get a reverse mortgage. Most people are used to borrowing money and repaying the loan through monthly payments. A reverse mortgage, on the other hand, lets a lender establish a line of credit with the homeowner. The money the homeowner receives does not have to be paid back until they sell the house or pass away.
To qualify for a reverse mortgage, you must pay off any liens or existing mortgages before you can use the rest of the money from a reverse mortgage. Depending on your age, you can borrow between 40 to 60 percent of the homes value. You also will have to be the primary resident in the house before you can qualify for a reverse mortgage.
After you get your reverse mortgage, you can continue to live in your home and, when you pass away, you can leave the home to your heirs. If you do leave your home to your children, the reverse mortgage must be paid off before they get the deed.
There are no time limits to repaying your loan. No penalties are levied for early payments and there are a few different types of reverse mortgages. You can change repayment plans. However, there may be some administrative fees attached. In one payment option, you can withdraw up to 60 percent of the funds immediately and draw the rest after one year. Another option would be to receive monthly payments as long as you live in the home. For some, they can opt for a combination of the two plans.
Getting a reverse mortgage on your home is simple, and most older people can qualify. The new jersey reverse mortgage facts are that most people will need a loan by the time they are 60 to cover emergency medical costs, repairs on the home or to help family members make ends meet. Getting this type of mortgage is easy and quick. There are plenty of lenders in the New Jersey area that can help you determine the best loan.