Reverse mortgages can be a great option for seniors who need extra income. In recent years, it has become a have become a popular financial asset for seniors. Although ACCC is a non profit credit counseling agency, we also offer reverse mortgage counseling. Let’s look at some reverse mortgage info that can be helpful in making your decision.
How Reverse Mortgages Are A Great Option for Seniors
A reverse mortgages are also known as Home Equity Conversion Mortgages. They provide a reliable stream of monthly revenue, which can be attractive for seniors who need additional income. Reverse mortgages can help seniors relieve the strain of tight finances and fixed incomes. It is a means of improving the quality of life for many seniors and creating peace of mind for family members.
However, knowing the ins and out of a reverse mortgage is crucial. Reverse mortgages can help seniors keep their financial independence and standard of living. But they can also be an expensive way to borrow money.
If used properly, reverse mortgages can lessen the chance that seniors will run out of money. With a reverse mortgage, seniors can choose from a number of different payment options. Options include a lump sum payment, lines of credit or monthly payment options. With lump-sum payments, the consumer gets one large payment to apply or use as they wish. A line of credit can provide consumers with more security than a lump sum payment because they are able to make withdrawals as needed. With the monthly payment option, the consumer can make a payment to themselves each month.
The best way to protect against potential problems during the reverse mortgage process is to enroll in a qualified, HUD-approved reverse mortgage counseling program. While required by the Federal Housing Authority (FHA), counseling is in all cases the best consumer defense against financial fraud and abuse against seniors.
Reverse mortgages are a great option for seniors, but the first step is important. By taking part in a reverse mortgage counseling session, seniors can learn about the benefits and consequences to a borrower’s estate, and then measure that against the benefits of steady income and peace of mind during retirement.
If you’re struggling to pay off debt, ACCC can help. Schedule a free credit counseling session with us today.