Often, the lender will require that there can be no other liens against the home. Any existing liens must be paid off with the proceeds of the reverse mortgage.
Read more: http://www.investopedia.com/terms/r/reversemortgage.asp#ixzz
You may also want to check out http://www.reversemortgageadviser.com/what-reverse-mortgage- for additional resources.
I hope this answered your question! If you have any further questions, please feel free to contact me by the ways below.
Wishing you all the best,
De Vonte Williamson , LSA
Proudly Serving Long Island
Coldwell Banker Residential
"I Stand Behind Getting You Results!
Commission pays out up to 11% on a deal! Wow! The good news is that most lenders will deduct that amount from your equity. In most cases, the payments made to you increase using compound interest which means that your equity gets eaten up real fast. Can you tell I don't like this product?
Many times, the children of the senior adult will rely on the equity of the home to pay for funeral expenses or to fund the grand child's education. In using the reverse mortgage, I'm hoping that the person already set aside money for at least the funeral expenses so that the family doesn't have to carry the burden of paying for all that.
With the government in the red right now and more cuts on the way, the cost of doing these loans may go up in price. It's got to come from somewhere...You may want to wait a few months to see if the sequester goes through or if we'll be learning yet another foreign language to make it through this quarter.
A reverse mortgage is a government insured loan that enables people who are 62 and older to extract the equity in their home (must be primary residence) for any purpose, whether it be to reduce their monthly expenses, use it to purchase another property or to receive a lump sum of a portion of their equity.
The primary qualification for a reverse mortgage is that you must have sufficient equity in your home to borrower against it. Since the reverse mortgage will be in place until either you sell the property or pass away, lenders will use actuarial tables to determine how much money you would be eligible to receive. So a 80 year old person with no mortgage would receive a larger payout than a 63 year old with a $100,000 mortgage on a property worth $250,000.
Let me know if I can be of further assistance to you.
Timothy Brown | LPO Manager
Evolve Bank & Trust
11605 Haynes Bridge Road Suite 125 | Alpharetta, GA 30009
678.468.5626 x110 | fax 678.935.1156 | cell 678.467.9959
There are only a few companies doing this type of mortgage. Wells fargo and Met life got out of the busying.
All remaining equity is inherited by the estate. The estate is not personally liable if the home sells for less than the balance of the reverse mortgage.