Reverse mortgage companies are not exactly hard to find. The first reason for this proliferation of lenders is that HECM products are a really great product for both sides of the deal. The equity you built up over all those monthly payments is worth a lot to the financial institutions because it represents a tangible asset. As a borrower, you gain quite a few real benefits from this type of home equity conversion mortgage.
No Monthly Payments
One of the most attractive aspects of a reverse mortgage is that you don’t need to make any monthly payments. For seniors over the age of 62, this represents an opportunity to level out a possibly shaky income stream cobbled together from social security or retirement savings such as Roth IRA’s or certificates of deposit. Converting the equity you hold as a homeowner into a liquid form allows you to level out your consumption.
You can defer payment until a number of very specific things happens. These often include major events like selling your home. Reverse mortgage companies will be able to give you the specific conditions under which you’ll need to repay your loan.
Liquidity
If you’ve paid off a mortgage, you’re probably familiar with the way one works. Just in case you don’t know, most mortgages transfer equity in the amount of the principal paid every time you make a monthly payment. That means that you built your equity up over time piece by piece until you had the level of value you have now.
All that value is great, but sometimes you’d rather have a source of money you can use. That’s where reverse mortgage companies come in. They’re equipped to analyze your home’s value and let you put that theoretical money to work for you in your everyday life. They’ll also be able to provide expert advice and walk you through each step of your journey towards financial freedom. Contact Longbridge Financial for information about our company.
