Reverse Mortgage
ANOTHER SENIOR TOOL FOR FINANCIAL HEALTH

Many seniors today face a serious financial problem. They need money. They own their homes, or have small mortgage balance and do not want to be forced to sell their home in order to maintain a daily standard of living. Many other seniors have enough money for their daily needs, but would like to do other things that they just can't afford. Another group of seniors would like to gift their children or grandchildren but do not want to reduce their savings or portfolio which provides income they need. One solution for these groups of seniors is a Reverse Mortgage.

A Reverse Mortgage is a home equity loan that does not have to be repaid until the home is no longer occupied as the primary residence. Loan amounts vary, based on the borrowers age, and zip code. Minimum age requirement is 62. The borrower must own the home or have a small mortgage balance, which is paid off at the closing. When the home is no longer the primary residence, the borrower cannot owe more than the value or selling price of the property. All equity in excess of the loan balance belongs to the borrower of the estate.

Borrowers can receive the funds in three different ways: a lump sum at closing, monthly payments for the tenure of the loan, or a line of credit. The borrower can also do a combination of the three options. The vast majority of reverse mortgages are FHA insured and therefore government regulated. The borrower still owns the home and retains title to the property.

Borrowers must complete a mandatory counseling session and receive a certificate of completion. Independent counselors conduct the session, either in person or by telephone. During the counseling session, the borrower will be informed of the other option available to them. The borrower's family is encouraged to participate in these sessions to answer any questions that they might have.

The benefits of a reverse mortgage include:

•  No loan repayment for as long as you live in your home.
•  Tax free funds for as long as you live in your home.
•  Retain ownership in your home for life as long as you maintain you home, and pay the taxes and insurance.
•  No income, medical or credit requirements.
•  Choose a cash flow plan tailored to your needs.
•  No restrictions on how you use your funds.
•  A tax advantaged way to pass on part of your estate today.

Contact the Township Supervisor's Office to arrange for a personal evaluation.

(815) 459-4011