Although many retirement dreams include relaxing and enjoying work-free days, the reality for many Americans is that retirement can sometimes be a stressful time.
Between rising health care needs, home maintenance and repairs, or simply limited cash flow due to a fixed income, retirement can actually feel less like relaxing and more like work. A reverse mortgage may be able to help if you’re finding yourself feeling limited by your current situation.
For those who qualify, here are a few ways a reverse mortgage may possibly improve your situation:
Freeing up cash flow. If you’re feeling pinched by tight finances in retirement, a reverse mortgage may be a way to simply free up some cash flow. By potentially tapping into your home equity while you still live in your home as a primary residence, a HECM (Home Equity Conversion Mortgage) allows you to access your loan proceeds as a lump sum, in monthly or ongoing installments, or as a line of credit you can access.*
Providing funds for home maintenance. For many older homeowners, home maintenance is daunting. The idea of shoveling snow, mowing a large lawn, dealing with exterior and interior fixes and other home improvements can be stressful. A reverse mortgage can potentially free up funds for these needs so you can enjoy your home with greater peace of mind.
Helping with age-friendly home improvements.With a reverse mortgage, you may be able to extend your ability to live in your home with a few simple home improvements, such as ramps for ground level access, or grab bars for stairs and bathrooms. A reverse mortgage can potentially provide funds you can access to help with these home improvements that make your home more livable as you age.
If you are feeling stressed by your retirement situation, consider the ways a reverse mortgage may be able to help you.
*Contact a reverse mortgage professional to learn about the borrower requirements to obtain a reverse mortgage and qualifications the home must meet to qualify for a reverse mortgage.
This material is not from HUD or FHA and has not been approved by HUD or any government agency.
FAReverse LLC i/l/t/n Finance of America Reverse LLC is Licensed Mortgage Banker in the State of New York, but this website has not been approved by the New York State Department of Financial Services. Until this website is authorized by the New York State Department of Financial Services, no mortgage loan applications for properties located in New York can be accepted through this site.
When the loan is due and payable, some or all of the equity in the property that is the subject of the reverse mortgage no longer belongs to borrowers, who may need to sell the home or otherwise repay the loan with interest from other proceeds.
FAR may charge an origination fee, mortgage insurance premium, closing costs and servicing fees (added to the balance of the loan).
The balance of the loan grows over time and FAR charges interest on the balance.
Borrowers are responsible for paying property taxes, homeowner’s insurance, maintenance, and related taxes (which may be substantial). We do not establish an escrow account for disbursements of these payments. A set-aside account can be set up to pay taxes and insurance and may be required in some cases. Borrowers must occupy home as their primary residence and pay for ongoing maintenance; otherwise the loan becomes due and payable. The loan also becomes due and payable (and the property may be subject to a tax lien, other encumbrance, or foreclosure) when the last borrower, or eligible non-borrowing surviving spouse, dies, sells the home, permanently moves out, defaults on taxes, insurance payments, or maintenance, or does not otherwise comply with the loan terms.
Interest is not tax-deductible until the loan is partially or fully repaid.