With a reverse mortgage, homeowners age 62 and older can convert part of the equity in their home into tax free cash. Along with this benefit, you do not have to sell your home, add a new mortgage payment, or give up the title. With a reverse mortgage, the payment stream is reversed as the lender makes payments to you – instead of you sending money to them every month.
How much money can I get from a reverse mortgage? This is the first question that most people ask. Your eligibility and the amount that you receive is based on many factors including the appraised value of your home, your age, interest rates, and with the government program, any lending limit in your part of the country. Generally speaking, the more your home is worth and the older you are the more money you can receive.
Reverse Mortgage Payments
Now that you know more about how a reverse mortgage works, as well as the amount of money that you can receive, it is time to take a closer look at the many payment options.
The most common option, used by more than 60 percent of people, is a line of credit. With this, you can take the money from your reverse mortgage as you see fit. Other options include a lump sum payment and fixed monthly payments for a predetermined term or as long as you stay in the home.
The money you receive from a reverse mortgage can be used however you see fit, from paying for healthcare to traveling the world.
If you are 62 years of age and have enough equity in your home, you can likely take advantage of a reverse mortgage. Now may be the time to speak further with a reverse mortgage lender.