If you are a homeowner of senior citizen age interested in acquiring some supplemental income or buying a new property, you might be able to utilize your current home’s equity to help you finance a new property without having to pay additional mortgage fees. Reverse mortgages are loans that are taken from the equity you have already built up from your current home. If you are an older homeowner in the areas of Palm Beach, Tri-County, and Broward County, Florida, and are interested in exploring your mortgage and financial options, CTC Mortgage is here to help. Continue reading to learn more about how a reverse mortgage can help you secure more financial freedom during your retirement.

How Do Reverse Mortgages Work?

A reverse mortgage is intended to help current homeowners over the age of 55 to convert their home equity into either a sum of cash or a line of credit. Rather than a borrower being required to make monthly mortgage payments to a lender as is done in a traditional loan, the lender makes payments to the borrower. So essentially in a reverse mortgage, the lender takes a loan out of your home equity and pays it back to you. If the homeowner’s original mortgage has not been paid off yet, a reverse mortgage can pay off the remainder of the existing mortgage, and any additional funds remaining after that can be utilized by the borrower in any way they want to spend it. Many people that opt for a reverse mortgage use the extra funds to help afford in-home medical care, buy another more suitable type of property, pay off debt, make home renovations. If they happen to be retired and running out of savings, a reverse mortgage can also help a borrower get the financial assistance that they need. In a reverse mortgage, a borrower is still responsible for paying the required fees and interest associated with the loan, but they will not be required to make monthly mortgage payments. The borrower still remains the owner of the home, and the reverse mortgage only becomes due when the homeowner passes away or moves out.

What Are The Benefits Of A Reverse Mortgage?

Even though a reverse mortgage may not make financial sense for some borrowers, it can be greatly advantageous for others. A major advantage of this loan type is that a borrower does not have to make monthly mortgage payments, and in fact, they are made to you. A borrower has the option to either receive that money as a lump or a partial sum, and they can receive the payments in cash, credit, or a combination of both of those options. You also get to remain as the owner of the home in a reverse mortgage, and the compensation that you receive is tax free. Also, since reverse mortgages are classified as a non-recourse loan, borrowers are protected from any changes within the real estate market and decreases in home values. If you are interested in learning more about obtaining a reverse mortgage in Palm Beach, Tri-County, or Broward County, Florida, contact CTC Mortgage today for a consultation.

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