Houston Reverse Mortgage
Reverse mortgage is usually applicable only to homeowners who have reached 62 years of age and above. This is a different type of home loan, and as the word reverse suggests, this loan allows the policy owners to convert the equity of their home into monetary value. Now that monetary value can be paid in a variety of ways.
Although it can be paid directly in one large lump sum of cash or a series of small payments over a span of time, some homeowners actually prefer the cash to flow into their retirement funds or as supplement to their Social Security funds. For others, a line of credit is preferred. And others still would prefer a combination of one or more or all of these pay-out options.
In case you do live in Houston, Texas and you want to avail of reverse mortgages here, you may want to look into several lending companies and prioritize those that are willing to give you the lowest possible interest rates. One of the pit falls that many homeowners succumb to when applying for reverse mortgages is that they only study which lending companies they can borrow the most amount from.
You do have to remember that this is a form of a loan, and it must be repaid with interest. It is therefore essential to think about a lot of factors like: closing costs, lenders’ charge origination fees, servicing fees and other miscellaneous fees. These can add up to a lot of money when you total the entire cost of your loan plus interest plus monthly payouts. So by the time repayment is due, or when the policy matures, your loan can be a staggering amount.
Here are some other basic things for you to consider.
One, for very obvious reasons, you must meet the minimum age requirement. As homeowner, your age at the time of the application (as well as other factors) affects the equity or loan that you can get. With the appraised value of your property and the recent interest rates at the time of your application, your present age may help dictate what Maximum Claim Amount you can borrow. It would be best if you could consult your affairs with the lender of your choice and a HUD (Housing and Urbanization Development) Approved Housing Counselor. However, as basic samples of this formula, you can see that: a 62 year old individual can borrow 25% of the property’s value; or a 75 year old individual can borrow 39% of the property’s value; or an 85 year old individual can borrow 56% of the property’s value.
Two, you as the applicant, need to have a single-family residence, or a 1-to-4 condo unit, or an FHA approved condo unit and or a manufactured home or mobile home that you can use as equity – and the loan you will receive should never exceed the value of your home.
Three, aside from the first two aforementioned facts, there is no income qualification for homeowners, or monthly payments due. However, the loan matures when the homeowner no longer uses the domicile as permanent living quarters. Repayment of the loan and interest are then mobilized either by: paying off the loan and the residence passes on the heirs; or the heirs sell the house to repay the loan. Either way, lenders should never have control of the property’s title.
If you want to check our more details as to how to acquire a Houston-based reverse mortgage, you may want to look several online companies that specialize with such service like: Calvert Mortgage Company, Challenge Financial Investors Corporation, First Alliance Mortgage, La Rouge Financing LLC, LoanStar Mortgage Solutions, etc. There are numerous others, though so you may want to surf extensively over the Internet for other options.
Written by charles dennis on March 28th, 2008 with
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