Reverse Mortgages:the Facts

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With a reverse mortgage (sometimes referred to as a a home equity conversion loan), borrowers of a certain age may use home equity for living expenses without selling their homes. Choosing between a monthly payment amount, a line of credit, or a lump sum, you may receive a loan amount determined by your home equity. Paying back your loan is not necessary until the homeowner puts his home up for sale, moves (such as into a retirement community) or passes away. You or representative of your estate must pay back the reverse mortgage funds, interest , and finance charges when your property is sold, or you no longer live in it.

Who is Eligible?

Typically, reverse mortgages are available for borrowers who are at least 62 years old, have a low or zero balance owed against the home and maintain the home as your main residence.

Reverse mortgages are helpful for homeowners who are retired or no longer working and must add to their limited income. Social Security and Medicare benefits aren't affected; and the money is not taxable. Reverse Mortgages may have adjustable or fixed rates. The lending institution can't take the property away if you outlive your loan nor may you be obligated to sell your home to repay the loan even when the balance is determined to exceed property value. If you would like to learn more about reverse mortgages, feel free to contact us at (805) 496-7500.

Strategic Home Loans, Inc. can walk you through the pitfalls of getting a reverse mortgage. Call us at (805) 496-7500.