A borrower can qualify for this reverse mortgage provided that:
•He/She is 62 years old or older•The home is owned free and clear (or has a great deal of equity available in it)•There are no tax liens against the property
In a reverse mortgage, the payment cycle is “flipped”, so that the borrower can receive a regular monthly payment from the bank, not the other way around! The borrower can also choose to receive funds all at once, or keep a line of credit open on the home.
Regardless of how a borrower chooses to receive funds, he/she has a significant advantage with this type of home loan since there are no income or credit or age limitations. Also, the senior doesn’t have to worry about making payments on time – there are no payments on a reverse mortgage until the borrower no longer resides in the home.
With the low savings rates of Americans today, and the uncertainty of future funding to our pensions and Social Security plans, this can be a very simple solution to help Americans with their retirement years.