While you send an application for any mortgage loan, it is better to have an idea on it. One of the common loan types for the house owners is reverse mortgage. This loan is intended for those, whose age is more than 62 years. It helps them in converting a part of their home equity into the cash.
Reverse mortgage is really one of the best options to the retirees, having very limited amount of income. These retirees use their wealth for covering the monthly expenses, including the healthcare cost. You won’t have any restriction on the way of using the proceeds from reverse mortgage.
In case of the conventional mortgage, you pay an amount to the lender. However, while it’s a reverse mortgage, the creditor has to pay to you. You won’t have to pay off your loan amount until you have vacated or sold the house. However, you must stay updated on your property tax and insurance.
Is there any risk in the mortgage?
While you have approached for reverse mortgage loan, you will have no risk to lose the property ownership or title. Your creditor does not own your house in any way. Your present age helps you to make out how much money you can get from the lender. Other factors, affecting the amount, including your house value, upfront costs and rates of interest. Older persons have a chance of getting higher amount of proceeds.
Funding limit with your reverse mortgage loan-
On the first year, you will be able to access very limited amount of money. While the loan amount is $100,000, you may access 60% of it. After thirteen months, you will get higher proceeds. However, in few cases, this 60% rule is not followed.
When you have presently property mortgage to repaid, you get an option of withdrawing more amount. The withdrawn amount will help you in paying off the mortgage. The additional amount that you can get is 10 % of $100,000.
The creditors will assess your financial condition. They try to make sure that you will be able to afford your stay in the house. You have to pay the property tax throughout the loan term. The lenders will also ask you about your pensions, investment or the source of income. You must disclose the delay in payment or credit-related issue. It is also essential to show the bank statements and information on the tax returns. The creditors check out whether you have presented the right clarification. Then, they give you approval of reverse mortgage.
The creditor will subtract the amount to be paid for insurance, tax and debt. The remaining amount of fund is your income on every month.
Nicholas Lambrinatos offering you reverse mortgage-
Reverse mortgage loan is of various types. You may better find out a reliable mortgage firm in Illinois and have this mortgage loan. Nicholas Lambrinatos, the CEO of one of the reputed mortgage companies in Chicago, offers this reverse mortgage to his clients. You may speak to the members of his team. Know all the rules to apply for this loan easily.