Article Side

Online Article Directory!

Hello Guest! Login or Register to submit articles!

Three Beneficial Ways to Use a Reverse Mortgage

By Amber Ladlie Subscribe to RSS | December 24th 2011 | Views:
loading
 
  



According to a national survey conducted by AARP in 2006, 97% of seniors were very satisfied with the results of their reverse mortgage. Of the seniors surveyed, only 3% did not believe their loan had a positive impact on their financial stability. Looking at these statistics, it is obvious that reverse mortgages are benefiting the large majority of borrowers. What many seniors are wondering is how. While reverse mortgages can be used any number of ways, most borrowers use these loans to accomplish one of three common goals:

Pay Off an Existing Mortgage Loan

According to the Center for Retirement Research at Boston College, the average pre-retirement household, consisting of individuals at least 55 years of age, has saved approximately $60,000 for retirement. Almost 20% have less than $5,000 saved for retirement. Many seniors are not only dependent on their Social Security income, but they claim benefits as soon as they become eligible which reduces the size of their monthly payments.

Although many seniors have not been able to save for retirement, they have accumulated a great deal of home equity. To eliminate their largest expense, many seniors use reverse mortgages to pay off their existing mortgage loans. By eliminating one’s mortgage payment, many seniors are able to increase their cash flow and enjoy retirement more comfortably.

Supplement Income During Retirement

Reverse mortgages are also frequently used to supplement seniors’ retirement income. Any proceeds that remain after repaying one’s mortgage loan can be used however the borrower wishes. Some borrowers choose to save their loan proceeds, while others use the cash to reduce their debt, pay medical bills, make home repairs, or simply enjoy extra spending money.

Purchase a New Home

In January of 2009, HUD began allowing seniors to purchase new homes through the Reverse Mortgage for Purchase program. Through this program, seniors are able to take a reverse mortgage on their current home and then use the proceeds to purchase a new property.

This program is beneficial for several different reasons. First, it helps seniors, who would not otherwise be approved for a mortgage loan, purchase a new primary residence. This makes it possible for seniors to downsize, purchase a more suitable property, or move closer to loved ones. The Reverse Mortgage for Purchase Program also eliminates the need to pay two sets of closing costs. Instead of paying closing costs on a reverse mortgage and new mortgage loan, borrowers are charged for one transaction. If a borrower’s loan proceeds exceed the price of the new home, he or she will also receive the difference. No other loan product offers the same benefits as the Reverse Mortgage for Purchase program.

When considering the different uses of reverse mortgages, it is not surprising that 97% of borrowers are satisfied with their loan. After all, these loans are both unique and extremely flexible. A reverse mortgage is the only loan product that allows borrowers to convert their home equity into cash that can be used to meet their most pressing financial needs.

Amber Ladlie - About Author:
Amber enjoys teaching people about financial products that can be used to further their quality of life without putting an extra strain on their pocketbooks. To see how much you can receive through a reverse mortgage, please visit http://www.seniorreversemortgage.com/ for more information.

Share on Facebook Tweet It Stumbleupon this post This post is delicious !

Article Source:
http://www.articleside.com/mortgage-articles/three-beneficial-ways-to-use-a-reverse-mortgage.htm

Related Mortgage Articles Subscribe to RSS

Lay your hands on the best mortgage rate in the market!
Published by Jack Smith on April 14th 2012 | Mortgage
While it may be a challenge to find the best mortgage rate¸ a good lender company can always make y...
 
The best mortgage rate is only a systematic approach away!
Published by Jack Smith on May 22nd 2012 | Mortgage
Investigate the property market well and fulfill your dream of achieving the best mortgage rate for ...
 
Wells Fargo faces mortgage risk
Published by Apil Gupta on July 16th 2012 | Mortgage
One out of every three home loans in the USA is currently being funded by Wells Fargo and Co., which...
 
Find the perfect california mortgage broker online
Published by Apil Gupta on June 24th 2012 | Mortgage
The importance of finding a good California mortgage broker online is paramount in today's times, pa...
 
Get out of a bad credit mortgage situation
Published by Jack Smith on June 20th 2012 | Mortgage
If you need a bad credit mortgage, there is no doubt that you are in a tight fix. But bail yourself ...
 
Good mortgage rates are important for a comfortable mortgage period
Published by Jack Smith on June 22nd 2012 | Mortgage
Get mortgage rates that you can easily pay off even in the future because a mortgage affair can last...
 
How to procure loans at Best adjustable mortgage rates?
Published by Jack Smith on June 24th 2012 | Mortgage
The above points can easily help a borrower to seek loans at best rates while saving his money and m...
 
Consultants to guide you for bad credit mortgage rates
Published by Jack Smith on July 26th 2012 | Mortgage
In the process of hunting for bad credit mortgage rates there has been seen an immense rise. But, to...
 
Tips to taken into consideration while choosing mortgage brokers
Published by Geno on March 28th 2012 | Finance
Majority of the home buyers get struck off when it comes to mortgage loans. Lack of knowledge about ...
 
US mortgage rates hit record low at 3.66%
Published by Apil Gupta on July 16th 2012 | Mortgage
There was a significant drop in the US mortgage rates for 30 year fixed loans...
 
Why is an adjustable rate mortgage so popular?
Published by Apil Gupta on June 24th 2012 | Mortgage
An Adjustable Rate Mortgage (mortgage ARM, for short), also known as the lender's Standard Variable ...
 
Low interest rate brings cheaper mortgage deals
Published by Sandra Jeux on January 25th 2012 | Mortgage
Interest rates are at the lowest side for mortgages at current time which is leading people of the c...
 
Get smart about mortgage rates
Published by Jack Smith on April 12th 2012 | Mortgage
The huge variety of mortgage rates makes it much simpler for the buyer to identify and take up the r...
 
You can still borrow money with bad credit mortgage
Published by Jack Smith on June 24th 2012 | Mortgage
Bad credit mortgage is really helpful for those who have bad history in past, and with the help of t...
 
A mortgage club benefits individual lenders to increase their business
Published by Graves Cruz on June 6th 2012 | Mortgage
We have worked alongside The Buy to Let Business since its incorporation....
 
US mortgage reforms on the way
Published by Apil Gupta on July 16th 2012 | Mortgage
The US mortgage industry is set for reforms in the form of shorter forms, if the Consumer Financial ...
 
Explore the different options of mortgage rates available
Published by Jack Smith on April 14th 2012 | Mortgage
It is advisable to first thoroughly investigate about the most lucrative mortgage rate in the market...
 
Your guide to finding the best mortgage rates
Published by Jack Smith on April 13th 2012 | Mortgage
The best mortgage rate may have to be decided upon after exploring several options but will be certa...
 
Understand and consult bad credit mortgage rates
Published by Jack Smith on July 23rd 2012 | Mortgage
The people seeking bad credit mortgage rates first require to conduct complete research and pay atte...
 
Exploring best adjustable mortgage rates as per expectations
Published by Jack Smith on July 23rd 2012 | Mortgage
The act and need for searching best adjustable mortgage rates is common in the world, where people s...