A friend of mine has a difficult time paying for repairs and he is late on his mortgage payments. Someone told him to ask for reverse mortgage. What does this implies? Is this a good advice? Have any of you done that and are you satisfied? Is it complicated?
2007-01-21 07:44:18 · 3 answers · asked by montralia 5 in Business & Finance ➔ Credit
To qualify for a reverse mortgage, your friend would have to be at least 62 yrs. old and the home must be paid for. If the mortgage is not paid off, you may still qualify. But there must be enough equity, after receiving the reverse mortgage, to pay it off.
In essence, you can get a lump sum or monthly payments to use as you wish. You don't have to pay this money back as long as you live in the home. Once you move, sell the home or become deceased, the loan must be paid back. The home can be sold by the heirs and use any profit to pay off the loan. The excess is given to the family.
When inquiring about a reverse mortgage, a couselor with talk with you about the reverse mortgage process and see if there are other alternatives available.
If your friend is senior citizen and of low income, there may be city or state programs available to help with repairs.
2007-01-21 08:09:40 · answer #1 · answered by Celeste 6 · 3⤊ 0⤋
It is for a paid off home. Usually for old people..The bank loans you up to 75% of the current value of your home. You pay no payments, but on your death the entire amount plus interest must be paid out. It usually means that the bank gets your house, but who cares you are dead anyway...
2007-01-21 08:06:14 · answer #2 · answered by Boston Bluefish 6 · 1⤊ 0⤋