How Does a Government Insured Reverse Mortgage Work? – Janice Cohen


Hi, I’m Janice Cohen and today we’re
going to explore how a government-insured reverse mortgage
works. First, the lender will calculate the loan amount based on the value of
your home, the age of the youngest borrower, and the current interest rates.
Typically, the loan amount will be about 40 to 60 percent of the home value. Once
the loan amount you qualify for is determined, the next step will be to
decide how you want to take your money. The loans closing costs can be financed
into the loan itself, so your beginning balance will be those costs plus any
proceeds that you decide to take at closing. If you choose not to take all of
your available funds at once you, might want to consider a 10 year plan, which is
a monthly payment designed to last for as long as you live in your home.
Similarly, a term plan is a monthly payment that you’ll receive in the
amount that you choose will meet your needs. Finally, you have the flexibility
to combine any or all of these options, such as taking some money now to pay off
debt, receiving a monthly tenure payment, and leaving the rest in a growing line
of credit. If you already have an existing mortgage, the reverse mortgage
will first be used to pay off that loan, eliminating your monthly mortgage
payments forever. Thank you for listening. And if you’d like to know if a reverse
mortgage might be right for you, please click on the link below to request more
information.

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