The reverse mortgage is one of the few areas of growth within the mortgage industry right now.
Colleen Moore, the President of Golden Equity Mortgage Corporation, specializes in the reverse mortgage, which she says is just like a regular mortgage.
“Ina regular mortgage, you take out the money and you make payments. With a reverse mortgage, it makes payments to you.”
Reverse mortgages are designed for seniors looking for a lump sum of cash or monthly income.
And whether you use the money for paying bills or a trip to Hawaii, it’s totally up to you.
“You don’t have to qualify. You don’t have to be credit-worthy. You don’t have to have a job. And with what’s happening in the credit market today,that’s huge,” Moore said.
There are a few things you do need, though. You must be over 62 years of age and the residence you want the reverse mortgage for must be owner-occupied.
The loan is paid back either when the homeowner passes away or they decide to sell.
“At that point, it’s like any other loan. The mortgage gets paid off and whatever is left, if you’re living, comes to you. If you’re deceased it goes to your heirs.”
The amount owed can never exceed the value of the home as long as the property is sold to pay off the mortgage.
But buyer beware.
You don’t want to be the next victim of a predatory lender.
“If someone is coming and they’re trying to get you to get a reverse mortgage and they open the other side of their lapel and they’ve got other products they want to sell at the same time, go the other direction,” Moore warns.
Moore says the biggest misconception about reverse mortgages is that you give up the title to your home.
“We are here to protect you, not take that away. Nobody is going to take your home, we just want to make your years you should be enjoying yourself more pleasant,” Moore said.