Content Overview 
- Summary
- What Is A Reverse Mortgage?
- What Steps Should I Take Before Obtaining A Reverse Mortgage?
- What Is Necessary To Qualify For A Reverse Mortgage?
- How Much Money Can I Get From A Reverse Mortgage?
- How Can I Receive The Loan Proceeds?
- Fixed Rate Reverse Mortgage versus An Adjustable-rate Reverse Mortgage
- How Do I Pay Back A Reverse Mortgage?
- What Obligations Does A Borrower Have While A Reverse Mortgage Is Outstanding?
- What Are Some Of The Pitfalls To Watch Out For When Considering A Reverse Mortgage?
- How Much Does A Reverse Mortgage Cost?
- What Is The Tax Situation With Respect To A Reverse Mortgage?
- What Effect Would A Reverse Mortgage Have On My Benefits?
- Counseling Session And Other Consumer Protections
- Using A Reverse Mortgage To Purchase A Home
- How Do I Locate A Source For A Reverse Mortgage?
- How Do I Obtain More Information About Reverse Mortgages?
Reverse Mortgages 101
How Much Money Can I Get From A Reverse Mortgage?
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The amount of the mortgage depends on:
- The age of the youngest borrower. (No one's health is considered).
- The current interest rate.
- Your equity in the home or the FHA insurance limit, whichever is lower. Your equity is the difference between the amount of any outstanding debt secured by the house (such as a mortgage) and its current market value.
- Loan fees.
The older you are, the greater the amount of money you will be able to receive as a Reverse Mortgage. The maximum amount for a reverse mortgage is set by federal law.
For an approximation of the gross amount you can receive as a Reverse Mortgage, see www.ReverseMortgage.org . (Keep in mind that "gross" is the amount before expenses are deducted.)
The net amount you receive depends on loan costs, which are expensive. Costs can include:
- An origination fee.
- An application fee.
- Closing costs (like a traditional loan)
- Premium for Insurance (that protects the lender if you outlive the value of your home.)
- A monthly servicing fee.
NOTE: Even if all you can borrow as a Reverse Mortgage is enough to pay off your current mortgage, or to receive payments equal to the payments due on your current mortgage, the loan may be worthwhile because it will reduce your monthly expenses.
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