Reverse mortgages (also called "home equity conversion loans") enable older homeowners to tap into equity without selling their home. The lender pays you money based on your home equity amount; you get a lump sum, a payment every month or a line of credit. The borrowed money doesn't have to be repaid until the homeowner sells his home, moves out, or passes away. You or your estate representative is required to pay back the reverse mortgage loan, interest accrued, and finance charges after your house is sold, or you are no longer living in it.
The conditions of a reverse mortgage often are being 62 or older, maintaining your house as your main living place, and holding a low remaining mortgage balance or having paid it off.
Many homeowners who are on a limited income and find themselves needing additional money find reverse mortgages helpful for their circumstance. Rates of interest can be fixed or adjustable and the money is nontaxable and does not affect Medicare or Social Security benefits. Your house can never be in danger of being taken away from you by the lending institution or sold without your consent if you live longer than the loan term - even if the current property value creeps under the loan balance. Call us at (401) 583-4150 to explore your reverse mortgage options.
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