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5 Reverse Mortgage Benefits

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A reverse mortgage has many benefits that can help senior citizens during their retirement years. The benefits included can help lighten the financial burden that can happen anywhere between retirement planning and the actual retirement.

5 Benefits of Reverse Mortgage

Here is a list of benefits of a reverse mortgage:

1. Don’t need to make monthly payments.

Unlike a forward loan or a home equity loan, reverse mortgages do not require monthly payments. The loan will become due once the last borrower leaves the home permanently or they are no longer keeping up with the borrower obligations to the lender.

2. You retain ownership of the property.

Many borrowers worry that when they apply for a reverse mortgage, it means that they are signing away the ownership of their property. Fortunately, that is not the case with the reverse mortgage. Because you are borrowing against the equity built up in your property, the home is still remains yours and does not belong to the lender.

3. Borrowers are able to use the loan however they want.

Borrowers are able to use their reverse mortgage loan in anyway that they please and there are many ways senior citizens can use their reverse mortgage loans to benefit them. Borrowers can use it to pay for long-term care, home repair, paying back mortgage or even purchasing a new car to ensure a reliable transportation during their retirement years. Some borrowers even use it to help their children during this tough economic environment, or invest in their grandchildren’s college education. Borrowers have even used their reverse mortgage loans to pay for their dream retirement vacation.

4. No maturity date.

Unlike most loans, there are no maturity dates for the reverse mortgage loan to be due. Reverse mortgages are typically due when the last borrower leaves the home permanently, by selling the home or passing away. The reverse mortgage loan can also be due when the borrower is no longer keeping up with their obligations to the lender. This includes:

  • Borrower must keep up with home insurance and taxes.
  • Borrower must live in the home as primary residence.
  • Borrower must maintain upkeep of the property.

5. Improve quality of life.

Reverse mortgages were meant to help improve the quality of life for senior citizens. There are many people who may not have saved enough for retirement or are facing financial obstacles that they are not prepared to pay. Reverse mortgages can be a lifesaver to help those who need financial assistance. As previously mentioned, the way a borrower can use their reverse mortgage is not regulated. They can use it to help maintain bills or pay for expensive long term care.

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