How a Reverse Mortgage Puts Cash in Seniors Pockets

How a Reverse Mortgage Puts Cash in Seniors Pockets

JR Mortgage Group Inc.
JR Mortgage Group Inc.
Published on October 5, 2022
Hpapy senior couple enjoying their retirment thanks toa reverse mortgage

How a Reverse Mortgage Puts Cash in Seniors Pockets

Let’s face it; times are tough. As inflation rises, so do costs, making daily life more expensive than ever. Simply going to the grocery store or filling your gas tank is double the amount it was only a year ago, a significant problem for seniors on a fixed income.

Even if your finances aren’t tight, it’s always nice to have extra cash on hand to go on vacation, visit your grandchildren, or do anything else you planned during retirement. You may have thought those dreams were no longer possible, but the good news is that they’re still within reach, thanks to a reverse mortgage!

With a reverse mortgage, Wichita KS, seniors can receive the cash they need quickly and easily without worrying about repayment. Living the life you always dreamed of is easier than ever, thanks to a reverse mortgage!

What Is A Reverse Mortgage?

A reverse mortgage is a type of loan available to seniors who own their own home, allowing them to borrow against their home’s equity, using it as collateral. Reverse mortgages generally don’t require repayment until the death or relocation of the last surviving homeowner, at which time the estate must repay the loan within six months.

The good news is that the estate isn’t held liable if the sale of the home is less than the loan’s balance, ensuring your loved ones never have to worry about repayment from their personal funds.

Who Is Eligible For A Reverse Mortgage?

To obtain a reverse mortgage, Wichita KS seniors must be sixty-two years or older, with no existing mortgage on their home. If there is a remaining mortgage balance, it must be repaid with the money from the reverse mortgage at closing. Additionally, all applicants must meet HUD financial eligibility requirements.

Are There Reverse Mortgage Loan Limits?

While there is no set amount seniors can receive with a reverse mortgage, there are four factors that will determine your individual loan limit. These include:

 

  • The youngest borrower’s age
  • The current interest rates
  • Your home’s appraised value
  • The set government imposed lending limits

 

Additionally, you should plan to set aside money from your reverse mortgage to cover insurance and taxes. You can use a reverse mortgage calculator to find out an estimated amount you are eligible to receive.

How Do I Get Paid With A Reverse Mortgage?

When choosing a reverse mortgage, Wichita KS, seniors can choose between four payment options. You can choose one or a combination of these options, creating a customized payment that perfectly fits your needs.

A Lump Sum

The lump sum option is only available as a fixed-rate loan and provides seniors a single cash payment at closing.

Tenure

The tenure option provides seniors with equal monthly payments for as long as the homeowner resides at the residence.

Term

The term option provides seniors with equal monthly payments for a set period of time.

Line Of Credit

The line of credit option gives seniors a set credit limit which they can draw out of at any time until the funds are exhausted.

Benefits Of A Reverse Mortgage For Seniors

Seniors can greatly benefit from a reverse mortgage as it opens financial doors and provides freedom to do what they want when they want. If you’re considering a reverse mortgage, let’s take a closer look at how it can significantly improve your quality of life.

Extra Cash On Hand

Reverse mortgages put cash in your pocket that you can use however you wish. Whether you’re planning that once-in-a-lifetime dream vacation, want to update your home, buy a new car, or anything else, you can do it with the cash you receive from the mortgage.

Expense Management

Managing your expenses in retirement is tricky, but a reverse mortgage can help simplify the process. Managed expenditures ensure you have the money you need to pay bills, buy groceries, travel, and whatever else you have planned to make your retirement more enjoyable.

Stay In Your Home

A reverse mortgage can be used to pay off your existing mortgage, allowing you to stay in your home. Upon approval, you are required to use your funds to settle your mortgage, so you never have to worry about high monthly payments again! Without a mortgage payment, you’ll have more cash in your pocket, giving you peace of mind and helping you breathe easier.

There Are No Taxes To Pay

The income you receive from a reverse mortgage isn’t taxable, so you don’t have to worry about paying income tax on the balance, which can make tax season far less stressful. It is important to note that tax rules can be confusing, so talking to a tax professional in your state is recommended.

You’re Protected From Housing Market Fluctuations

Since it is a loan, its balance grows over time, which could be problematic with shifting housing markets. Fortunately, because these types of mortgages are considered a form of “non-recourse” financing, the lender cannot come after your heirs or your other assets if your mortgage balance exceeds your home’s value.

If you could benefit from having some extra cash on hand, a reverse mortgage may be right for you. There are so many benefits, including no monthly payments, heir protection, peace of mind, and more; it’s no wonder seniors across the country turn to reverse mortgages to get the most out of their retirement.

Where Can You get More Information on a Reverse Mortgage?

JR Mortgage Group is proud to provide friendly and knowledgeable service to those in the Wichita area. Our expert team works with you, helping connect you with quality lenders you can trust. We will ensure you receive the most money at the lowest rates, giving you unmatched peace of mind. When searching for a reverse mortgage in Wichita KS, seniors turn to JR Mortgage for dependable and proven results every time! Give us a call at 316-247-9639

JR Mortgage Group Inc.
JR Mortgage Group Inc.
Click to Call or Text:
(316) 247-9639

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