If you’re over 62 years old and own your home, you have an opportunity to unlock the power of home equity. You can do this through a Home Equity Conversion Mortgage (HECM), also known as a reverse mortgage. In this blog, we’ll explain what HECMs are and how to make the most out of them in order to help increase your retirement funds.
A HECM is a type of equity mortgage loan that allows homeowners over 62 years old to convert their home equity into cash or other forms of income. Unlike traditional mortgages that require monthly payments, HECMs are different because they provide homeowners with stable income distribution options for life or for as long as they live in their homes. This means that when you take out a HECM, you don’t have to worry about making mortgage payments each month. Instead, the lender pays you based on the amount of equity you have in your home!
In order to qualify for a HECM, there are certain requirements that must be met. First and foremost, you must be at least 62 years old and own your home outright or have only minimal existing debt on it. Additionally, all borrowers must complete counseling from an independent third-party approved by the Department of Housing and Urban Development (HUD). This counseling provides information on how equity mortgages work so that borrowers understand all aspects of the process before signing any agreements.
There are numerous benefits associated with taking out a HECM loan. For starters, it allows seniors to access additional retirement funds without having to downsize or move away from their current homes (which can be especially beneficial if they’ve built up equity in those homes). Additionally, because these loans do not require monthly payments like traditional mortgages, seniors can use the proceeds from these loans however they see fit – such as for medical bills, travel expenses or even investing in more real estate – without worrying about accumulating more debt. Finally, these loans may also serve as an additional source of income during retirement since borrowers receive regular payments from lenders based on their loan balance until it is repaid in full. Why not leverage your home’s equity for investment income instead of using your retirement fund accounts like an IRA or even your pension fund for living expenses during retirement? Many seniors use these funds to pay their mortgage payments, sometimes due to the loss of a spouse and their income contributions that have been helping them with living expenses. With a HECM, you not only can use the equity in your home to help subsidize the need for monthly retirement income, but also reduce your mortgage payment or remove it entirely.
Taking out a Home Equity Conversion Mortgage (HECM) is an excellent way for older homeowners to access additional retirement funds without having to downsize or move away from their current homes while still being able to use these proceeds however they see fit without accumulating more debt. With its numerous benefits – including no monthly payments required – it is no wonder why many seniors are turning towards this option in order to make the most out of their home ownership! And for those who need to move out of their home into a new home, for example from a 2-story home into a single-level home perhaps due to medical issues, you can use a HECM for that too. If you’re interested in learning more about how this could benefit your retirement planning efforts, contact us today so one of our professionals can walk you through every step of the process!
Taking out a Home Equity Conversion Mortgage (HECM) is an excellent way for older homeowners to access additional retirement funds without having to downsize or move away from their current homes while still being able to use these proceeds however they see fit without accumulating more debt. With its numerous benefits – including no monthly payments required – it is no wonder why many seniors are turning towards this option in order to make the most out of their home ownership! And for those who need to move out of their home into a new home, for example from a 2-story home into a single-level home perhaps due to medical issues, you can use a HECM for that too. If you’re interested in learning more about how this could benefit your retirement planning efforts, contact us today so one of our professionals can walk you through every step of the process!
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208.985.4933
mandy@idahopropertyinvesting.com
Approaching aging without fear and with confidence is so important, and with some foresight and planning, you can easily use a reverse mortgage as part of that plan.
Whether you want to stay close to town or live in a more rural area, there are plenty of retirement options in Idaho to choose from.
Are you familiar with how reverse mortgages have evolved over the years and how they could benefit you now more than ever?
Reverse mortgages and Home Equity Lines of Credit (HELOCs) can both be attractive options for those looking to tap into the equity in their homes.
The Real Estate Agents of Idaho Property Investing, LLC are part of the Atova, Inc. Real Estate Brokerage located in Boise Idaho.
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Our team would love to talk to you more about how you can use your existing home equity as a way to increase your financial security and how to leverage your equity to buy a new home or rental property.
I would love to talk to you more about how you can use your existing home equity as a way to increase your financial security! I have personal experience with my parents that has led me to have a passion to help people who qualify for a reverse mortgage gain financial peace of mind. Please fill out the form below or you can also text ro call me at 208.985.4933.