![]() However, the availability of independent reverse mortgage counseling helps. The program is not well understood by most individuals.You should consult a qualified professional to determine if there would be any impact to your government benefits. However, some needs based government benefits such as Medicaid and Supplemental Security Income (SSI) may be affected by a reverse mortgage loan. A reverse mortgage loan usually does not affect eligibility for entitlement programs, such as Medicare or Social Security benefits.The loan balance gets larger over time and the value of the estate/inheritance may decrease over time.The fees on a reverse mortgage are the same as a traditional FHA mortgage but are higher than a conventional mortgage because of the insurance cost.The interest rate may be lower than traditional mortgages and home equity loans.Loan proceeds are not taxed as income or otherwise (though you must continue to pay required property taxes).Heirs inherit the home and keep any remaining equity after the balance of the reverse mortgage is paid off.A reverse mortgage can not get “upside down” so the heirs will never have to repay more than the value of the home. ![]() Lump sum distribution (only on fixed rate loans).The homeowner receives payments on flexible terms:.No monthly mortgage payments are required, however the homeowner must live in the home as their primary residence, continue to pay required property taxes, homeowners insurance and maintain the home according to Federal Housing Administration requirements. Failure to meet these requirements can trigger a loan default that may result in foreclosure. ![]()
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