When searching for funding in the real estate world, it’s crucial to understand each loan type and its definition. Reverse mortgage is one important term you may encounter when thinking about building equity in your home. But what does reverse mortgage mean?
A reverse mortgage refers to a loan type available to homeowners aged 62 or older, and permits them to turn their home equity into income without monthly mortgage payments. A reverse mortgage loan essentially lets you borrow money, nearly uninhibited, against the equity you’ve already invested in your home.
There are several types of reverse mortgages to choose from, depending on a variety of factors. The most common form of reverse mortgage is the HECM.
An HECM is also sometimes called a Federal Housing Administration (FHA) reverse mortgage, and is only available to those who meet FHA qualification requirements.
To those who qualify, there can be definite advantages to a reverse mortgage. Reverse mortgage loans allow many homeowners the flexibility to supplement their income later in life and benefit from their investment in their homes. They can also be helpful in situations where significant costs, such as healthcare, necessitate a lump sum payment.
However, reverse mortgages don’t make sense for everyone. It’s best to find a trustworthy lender or loan program before considering this type of loan, and discuss your options with a trusted financial advisor.
The BAP Team wants to thank you for visiting our Site. I have over 40 years experience with Real Estate. As a young man my first purchase was a 3 unit building which set the tone for many experiences including the Foreclosure Process, Buying at Auctions & Bank Owned REO's. We represent Buyers and Sellers as well as seasoned investors in building wealth with multi-family homes. Teamed with my daughter Cara as a Closing Coordinator, Our Mission is to provide you with the service you need in order to make the process of Buying and Selling educational and rewarding. It is our goal to treat your real estate as if it were ours. You can be assured your 'Best Interest' will always be our top priority.
