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Reverse Mortgage Loans: Better than a Second Mortgage
from:There are so many different kinds of loans that it can be very hard to keep track of them all. Even with mortgage loans, there are so many different kinds. Take reverse mortgage loans, for instance. Most people don't even know that they exist. If they need extra money, they get a second mortgage or a home equity loan instead. While these are valid options, they do provide more of a risk. Well, reverse mortgage loans are similar because they use your existing equity to give you money. However, they are actually much better than what you would get with those other loans.
Reverse mortgages work a little differently. Instead of giving you a new loan like a second mortgage or a home equity would do, it really just gives you cash on the equity that you've built up on your home. Equity is the amount your home is worth beyond what you already owe. For instance, if you have a house that is worth $150,000 and you still owe $100,000 on the original loan, that means you have built up $50,000 in equity.
The big difference between reverse mortgage loans and other, similar loans is the repayment. With this federal loan, you don't have to repay it until you no longer live in that house. If you continue living in the house, you don't have to worry about paying it back. If you do sell your house, the portion that you received from reverse mortgage loans will be taken out of the money you get from the sale.
Not everyone can reap the benefits of reverse mortgage loans, though. Since this is a federal type of loan, they have very strict rules. For one, you need to be living in this house. It should be your main residence. It can also be either a single family home, or up to a four family residence. Finally, there is an age requirement. You need to be at least 62 years old in order to get one of these loans. These are the main rules regarding reverse mortgages. If you feel that you may qualify, it wouldn't hurt to give it a try. These loans are really much better than home equity or second mortgage loans.
There are many benefits to reverse mortgages that you don't get with the other loans. These are especially helpful if you plan to live in your house for an extended period of time, because you won't have to pay it off until you plan to move. This is one of the best mortgage loans out there and worth the trouble in order to receive it.
Mortgage Rates Loans News
Home shoppers rush in as mortgage rates fall - USA Today
 Straits Times | Home shoppers rush in as mortgage rates fall USA Today - Some brokers report rates as low as 5.25%. Borrowers with a $200000 loan, for example, would save about $63 a month if their interest rate dropped to 5.5% ... Mortgage rates fall, but many borrowers will have trouble qualifying Mortgage Rates Tumble on Fed Debt Purchasing Plan (Update1) Freddie Mac shows weekly decline, Fed actions spur even lower rates |
Bernanke: Interest rate cuts won't be enough - USA Today
 ABC News | Bernanke: Interest rate cuts won't be enough USA Today - Mortgage rates fell last week, for instance, after the Fed announced it would buy up to $100 billion in Fannie Mae and Freddie Mac bonds and other debt, ... Fed Prepared to Lower Interest Rates, Bernanke Says Ben Bernanke: Fresh Attack on Mortgage Rates Bernanke Says Fed May Buy Treasuries to Aid Economy (Update3) |
Mortgage rates and affordability - MarketWatch
Mortgage rates and affordability MarketWatch - However, falling home prices and lower mortgage rates could finally entice wary buyers. With some foreclosures selling at rock-bottom prices, Credit Suisse ... Housing affordability eases slightly |
You can qualify for mortgage, it's just tougher - San Francisco Chronicle
 San Diego Union Tribune | You can qualify for mortgage, it's just tougher San Francisco Chronicle, USA - The best rates and widest variety of loans are available to borrowers who have at least 20 percent to put down, said Matt Vernon, a national sales executive ... Reverse mortgages a lifeline for seniors |
US Treasury Yields Drop to Record Lows on Recession Concern - Bloomberg
US Treasury Yields Drop to Record Lows on Recession Concern Bloomberg - When mortgage rates fall, holders of the home loans are more likely to prepay, reducing the duration. “There may be some convexity bid from the mortgage ... Yields ‘Next to Nothing’ Lure Funds to Riskier Assets (Update3) US Treasuries Gain Most Since 1981; Longer-Term Yields Plunge Treasury Yields Drop to Record Lows as Bernanke Cites Buybacks |