The HECM Reverse Mortgage program was created to give our retiring generation a way to keep their homes and manage the ever increasing costs of life in America after working long and hard over the years. It is an option that could be just right for you. All applicants are required to participate in HUD approved counseling to ensure all their questions and concerns are addressed. Working with a reputable reverse mortgage advisor will also be critical in the process, as this person should be your advocate – even telling you when a reverse mortgage may be wrong for you.
Let’s unravel the myths floating around about what a reverse mortgage is and what it does. Here are a few myth busting facts:
Myth #1: Reverse mortgages are only for poor people.
Myth #2: It’s free money.
Fact: It is a loan specialized for those 62 years old and older that does not need to be paid back until the last borrower passes away or leaves the home permanently, or if the borrower defaults on property taxes or homeowners insurance. If anyone attempts to market a reverse mortgage as “free money”, beware as it is likely a scam.
Myth #3: The bank owns your home.
Fact: The title of your home stays in your hands, and you own it just like you would with a conventional mortgage.
Myth #4: It is not a safe program.
Fact: Reverse mortgages are FHA insured and fully guaranteed – regardless of how you receive the payout.
Myth #5: My equity is safe if I don’t use a reverse mortgage right now.
Fact: Your equity is dependent upon the housing market, which is always changing. And as markets improve, home values continue to rise, so even if you have a reverse mortgage, your equity can still increase – equity that will be available to heirs when the loan comes payable.
Myth #6: If I’m married, my spouse will lose the home if I pass away.
Fact: Married couples can both be on the loan if both are 62 or older. There are many ways to ensure both spouses are not at risk.
Sara Cornwall is a local Reverse Mortgage Advisor serving the entire state of Connecticut. Contact Sara and learn if reverse mortgage is right for you.