Posted on: 23rd Jul, 2008 09:19 pm
I would like the bottom line of the $ amount of a reverse mortgage.
This is a very broad question and there is no ONE bottom line on the dollar amount. It used to be that the HUD had the only reverse mortgage out there. Now there are many different programs including a Jumbo reverse mortgage. The way they work is fairly simple. The owner must be 62 (60 for some) years of age. They must have a lot of equity in their home... usually 50-60% equity. The numbers are based on a calculation using the age of the youngest borrower and the valud of the home.
The borrower usually has options to how they would like to receive their money 1) a lump sum 2) monthly payments) 3 a line of credit
The amount allowed to be borrowed takes into account the fact that the interest must be paid for the life of the borrower by the equity of the home as NO payments are due with a Reverse mortgage.
It is a great way for seniors to supplement their retirement and get rid of a mortgage payment. The bad side is that is does eat away at the equity of the home. The trade off is clear NO PAYMENT and in many cases a payment made to them.
Hope this is clear if you have a specific question please let post up.
Brian
The borrower usually has options to how they would like to receive their money 1) a lump sum 2) monthly payments) 3 a line of credit
The amount allowed to be borrowed takes into account the fact that the interest must be paid for the life of the borrower by the equity of the home as NO payments are due with a Reverse mortgage.
It is a great way for seniors to supplement their retirement and get rid of a mortgage payment. The bad side is that is does eat away at the equity of the home. The trade off is clear NO PAYMENT and in many cases a payment made to them.
Hope this is clear if you have a specific question please let post up.
Brian