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Reverse Mortgages are more popular than ever in Texas!
Is it a good option for you? What are some of the pros and cons you should consider?
What people love is the peace of mind and the ability to meet financial obligations
such as medical bills and still be able to enjoy life.
Also, the ease of the loan process is a positive factor in that neither your credit history,
nor your income is a factor in qualifying for the loan. You just have to have at least
50% equity in your house, a minimum loan value of $100,000 and be at least 62 years old.
Freedom from monthly payments is another attractive factor. Once you have the reverse mortgage
loan any existing mortgages will be paid off from the proceeds of the loan. Thereafter
you are not required to make monthly mortgage or loan payments ever again, thus relieving
one of the great burdens facing many retired persons.
Some are concerned that they will lose the tax deduction of the interest on their home
payments. But this is perhaps more than compensated by the fact that the entire reverse mortgage
loan is tax free.
For many it is comforting to know that when you pass on and the home is sold to repay
the loan, any remaining value does pass to your heirs. Likewise, in the event that the
amount owed exceeds the amount realized from the sale of the home, the reverse mortgage
lender cannot turn to your heirs for payment.
Since you are required to continue living in your home, a reverse mortgage may not work
for you if you want to be able to use your home as a rental property in the future. Likewise,
if you are determined to leave your home to someone, perhaps a disable child, then a reverse
mortgage is not an option you should consider.
Another concern for some is that the costs associated with a reverse mortgage are often
higher than those of a traditional mortgage. For example the amount you pay more for your
FHA insurance. But this is because this insurance guarantees that the bank can never ask you
or your heirs for payment if the sale of the home results in less money than was owed to
the reverse mortgage lender.
Also you should know that you are required to set aside funds for the annual tax and
insurance payments on your home. As the home remains in your name this requirement protects
both you and the reverse mortgage lender.
There are many pros and cons to consider in making the decision to take out a reverse
mortgage. So it is good to know that you are required to take a special course which explains
in detail all of the possible ramifications of the reverse mortgage you are considering.
We are here to help you get the information you need and to find the very best reverse
mortgage lenders in your area. If you meet the initial requirements of being at least
62 years old, having at least 50% equity in your home and a loan value of at least $100,000
the contact us today for a completely free consultation. Once we have your information
we will send you a complete packet that shows how much you could qualify to borrow and a
list of the best reverse mortgage lenders in your area.