Seniors Short on Cash Should Consider a Reverse Mortgage Chatham IL

by | May 6, 2013 | Financial Services

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If you watch TV, chances are you have seen a commercial for a reverse mortgage Chatham IL. Reverse mortgages allow seniors to use the equity they have built up in their home to provide them with more cash flow. Some choose to use the reverse mortgage to pay off debt, such as credit cards, while others opt to use this money to pay off a home equity loan or another bill. Reverse mortgages, also known as home equity conversion mortgages, can be used in both situations and many others.

According to the National Council on the Aging, a reverse mortgage would be of benefit to more than 13 million older Americans. The mortgage would allow the senior to stay in his or her home while paying for long-term care. The senior would be able to remain independent longer, which is of great importance to many. The Robert Wood Johnson Foundation along with the Centers for Medicare and Medicaid Services found that reverse mortgages can help to alleviate financial burdens on individuals and their families while also helping to relieve the burden on the federal government and state Medicaid programs.

Homeowners concerned about taking out a reverse mortgage Chatham IL needn’t be. These loan products are backed and regulated by HUD and FHA because this is a federal program. As this is ‘non-recourse’ loan, the senior’s heirs won’t be responsible for repaying the loan unless both homeowners, assuming the homeowners are a married couple, leave the home permanently or pass away. There are no monthly payments with this type of loan as the senior is the one who receives the payments. All money received from a reverse mortgage is tax free and won’t interfere with Medicare or Social Security benefits the recipient is currently receiving.

The extra money that may be brought in from a reverse mortgage can be used for in-home care, as mentioned above, or for many other things. Before this loan product may be obtained, the senior must attend a counseling session offered by HUD. This guarantees the homeowner understands how the process works and can have any questions answered before proceeding. The trained counselor works with the homeowner in person or over the phone. After this session, the senior receives a certificate which must accompany the loan application. If you feel a reverse mortgage may be right for you, contact a loan provider today.

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