Reverse Mortgages can be an excellent option for those who are looking for an opportunity to increase cash flow using their home equity. Here is what you need to know about qualifying for a Reverse Mortgage loan in San Diego.
Am I eligible for a Reverse Mortgage loan?
There are two main requirements for eligibility for a Reverse Mortgage:
- Age – Reverse Mortgage loans are available for individuals who are 62 years of age or older.
- Equity – To be eligible for a Reverse Mortgage loan you need to own a significant portion of equity in your home.
How does my income affect my eligibility for a Reverse Mortgage?
Unlike other mortgage options including a Home Equity Line of Credit (HELOC), Reverse Mortgages do not have income requirements for eligibility.
How does my credit score affect my eligibility for a Reverse Mortgage?
Much like income, your credit score does not affect your eligibility for a Reverse Mortgage loan.
More traditional Home Equity loan options or HELOC’s do still provide homeowners with access to home equity, but in contrast to a Reverse Mortgage, these options require borrowers to make monthly payments. As a result, credit scores and income determine whether the loan will be approved or not. With Reverse Mortgages offering an increase in your cash flow, rather than a decrease, the Reverse Mortgage option just makes sense for homeowners who are looking for options to ease any financial burden they may be facing and enjoy their retirement.
Qualifying for a Home Equity Conversion Mortgage
A Home Equity Conversion Mortgage (HECM), is the most common Reverse Mortgage loan. The homeowner will receive monthly payments that increase their loan amount over time. With this option, the title to your home will remain in your name while you continue to live in the property as your primary residence. The homeowner must keep up with property taxes, homeowner’s insurance and the general maintenance of the home. The Reverse Mortgage loan will be repaid when the homeowner no longer lives in the residence.
Another benefit a Reverse Mortgage offers is the ability to Age In Place. Baby boomers and seniors are now choosing to stay in their home for the remainder of their lives instead of the traditional costly option of moving into an assisted living facility or full-time care facilities.
The Reverse Mortgage process can feel overwhelming at first, but not if you have an excellent team at your side. Talk with the professionals at San Diego Reverse Mortgage Loans to see if a Reverse Mortgage, or another loan option, may be the right “Retirement Mortgage” for you.
