Some seniors are “house-rich, cash- poor.” They have significant equity invested in their home (maybe the mortgage is paid in full), but Social Security is not enough to pay monthly bills or meet surprise expenses or growing debts. You have money, it’s just tied up in the value of your home. A Reverse Mortgage pays off your existing mortgage and can return some of the money you have already paid.
We can brainstorm a mortgage solution that provides immediate relief, while looking at your goals for the future.
“What can I spend the Cash for?”
This is usually the first question in the Reverse Mortgage process. The answer is “Almost anything.” Once the previous mortgage is paid, you can use the money to pay off debts or medical expenses, home renovations, once-in-a-lifetime vacations, savings—almost anything you want!
“Do Both Spouses Need to be 55?”
No. The older homeowner needs to be 55, and loan proceeds are based on the younger homeowner’s age.
“I Still Have a Mortgage. Can I Take Out a Reverse Mortgage?”
Absolutely—the existing mortgage is paid in full, and then you receive any remaining cash. If you still want to make monthly mortgage payments, they are voluntary at this point. As the homeowner, you’re still responsible for insurance, property taxes, and maintaining the property. There are some Reverse Mortgages that include a Life Expectancy Set Aside (LESA) that can pay your taxes and insurance for you.
“Do Some Homes Not Qualify for a Reverse Mortgage?”
Vacation homes, secondary residences, and primary residences that include four or more rental units do not qualify for a Reverse Mortgage. For other refinancing options for these properties, please call us directly (760) 579-9519.
“Do I Still Own My Home?
Lenders are not in the business of owning homes — they want to make loans and earn interest. Homeowners keep title to their home. The Lender adds a lien on title so that the loan is paid from the proceeds of the sale.
“What Happens to my Social Security and Medicaid with a Reverse Mortgage?”
Government programs such as Social Security and Medicare are not affected by a Reverse Mortgage. However, needs-based programs such as Medicaid can be affected. To remain eligible for Medicaid, homeowners can manage their monthly stipend amount to remain below Medicaid limits. You should consult with a qualified financial advisor or case worker to learn how a Reverse Mortgage could impact eligibility of government benefits.