Reverse Mortgage Loan – What Does My Inner Voice Say?

This an error in the attitude, but it is useful to discuss through this issue. It is understandable to take this topic on the table, because you have paid your mortgage for so many years, that it feels odd to start to use it in the form of the reverse mortgage loan.

1. Do I Have The Right?

To put it simple, yes you have! It is your money, which you have saved during many years. Actually you are the only person, who has the right to touch your home equity, it is not meant to the heirs. And you cannot use the whole home equity for two reasons. There are limits for the maximum reverse mortgage loan and the home prices will increase, so it will add value every year during a long period of time.

2. Can I Continue Living In My Old House?

Actually, the reverse mortgage loan makes it possible, that you can, because the amount of the disposable money will increase, which allows you to pay the bills. The loan terms will never change the ownership of your home.

3. Can I Take My Spouse With?

This is a good question, because most people have their spouses. Yes, you can. Actually altogether three persons can be in the title, i.e. as owners of the home and borrowers of the reverse mortgage loan. They have not to be relatives, but all must fulfill the qualifications.

4. How The Loan Can Grow During The Running Time?

The reverse loan is like a usual mortgage in that respect, that all other expenses but the interest are fixed during the whole running time. Also the interest rate is fixed, if you have chosen a fixed rate instead of a variable rate. Actually the loan grows all the time, because nothing will be paid away and all costs will be added on the top of the previous ones. This means that if the interest rate is high, the compound effect increases the loan sum quickly.

It is understandable, that it is challenging to make a decision, whether to take this loan or not, because you have so many things to solve. If you want to live in your own home, where all of your memories are, it is very human to stay there surrounded by familiar neighbors.

If your decision depends on the situation of the heirs, then maybe the solution will be different. However, the most important thing is that a human being has the right to live full life all the time and if this requires the usage of the home equity, then you just use it. A reverse mortgage loan offers a good solution for your financial needs.

Juhani Tontti, B.Sc., Marketing. The reverse mortgages include several details, which you have to go through, before you decide about your reverse mortgage application. Visit: reverse mortgage loan.