Reverse mortgages offer a viable solution for seniors looking to pay off their mortgage, enhance their income, or pay for various healthcare expenses. Whether you are eligible for a reverse mortgage depends on you meeting specific requirements.
With a regular mortgage, you are obliged to pay the lender on a monthly basis for your home loan. The main advantage of a reverse mortgage is that the lender pays you, in return taking part of your home equity in the form of advanced payment. There are no monthly reverse mortgage payments. Reverse mortgages do offer borrowers a choice, and you can opt to pay back your loan monthly if you prefer. Consult with a reverse mortgage loans expert in San Diego to find the best type of reverse mortgage for your situation.
Who qualifies for a reverse mortgage?
A reverse mortgage allows you to increase your income utilizing your home’s equity. It gives you a much needed boost that will help you meet your financial needs. If interested in such a loan, you must meet the following requirements:
- Borrowers must be 62 years of age or older: This type of mortgage is available to individuals approaching retirement or those who are already retired. It is designed to help seniors age in their homes.
- The home should be your primary residence: For the duration of the reverse mortgage, you must live in your home. Vacation homes and rentals are not eligible for this type of mortgage.
- You must be the owner of the home: For the reverse mortgage to pan out, you must own your home or have a low enough remaining mortgage balance.
- Reverse mortgage counseling: You must meet with a counselor approved by the Department of Housing and Urban Development. They will proceed to walk you through the ins and outs of reverse mortgages. This counseling meeting aims to ensure the borrower is fully aware of the pros and cons of such a mortgage.
Homes eligible for reverse mortgages are:
- Single-family houses
- 4-unit maximum family home with one unit occupied by the borrower
- Manufactured homes that are HUD-approved
- Condominiums that are HUD-approved
In order to qualify for a reverse mortgage, you must be financially capable of meeting your loan obligations. These include paying property taxes, home maintenance and repairs, insurance, and any Homeowners’ Association fees for the duration of the loan.
Do you need income to qualify for a reverse mortgage?
Applying for a reverse mortgage will subject you to minimum income qualification requirements. The financial assessment process is similar to that of traditional mortgage loans. The lender conducts an evaluation of the borrower to make sure they have the necessary funds to pay for ongoing expenses such as property taxes, insurance, and home maintenance. The lender will ask to analyze all types of income, not just the typical employment income. These include overtime and bonus, part-time, as well as seasonal employment income. The lender will also take into consideration income and benefits such as rental income, pension, and disability benefits.
Learn all about reverse mortgage loans from experts in San Diego
Get the best of both worlds with a reverse mortgage. Keep living in your home, and receive supplemental income to reach your goals. Our specialists will provide you with expert advice and find the right solution for you.
No matter if you’re located somewhere downtown or near Old Town San Diego, you can trust us to give you an honest opinion on reverse mortgage loans for your property and whether it’s something you should consider. Call today and set up a consultation!