Just like several positive feedbacks, there are many misconceptions about reverse mortgages. This isn’t surprising because this financial program involves giving a monthly cash flow along with a monthly retirement income to a qualified senior citizen who is at least 62 years old.
Common Reverse Mortgage Misconceptions
The first misconception is that the bank will own your house once you avail of the reverse mortgage loan. This is not true. As a matter of fact, your house will be yours provided that you always remember these three things. You need to live in the house, you need to pay your property taxes and insurance, and you need to maintain your property to make sure that it remains in good living conditions. You can also use the money you get from a reverse mortgage loan to cover all the expenses required for the home repair and maintenance.
The second misconception is that a reverse mortgage loan is risky. On the contrary, this kind of loan is safe. You might be wondering why. It’s because reverse mortgages are federally protected to make sure that senior citizens won’t be taken advantage of by any lending institution. There are some safeguards as well as stringent rules that the federal government have set up to encourage only the best interest of these people.
Some people also think that they cannot qualify for a Myrtle Beach reverse mortgage if they still have an existing mortgage loan on their homes. Once again, this isn’t true. In case your house still has enough equity, then you are legible. You just have to pay off your current mortgage balance once the loan is closed. However, you can also use the reverse mortgage loan Myrtle Beach to pay off that existing balance.
If someone tells you that a reverse mortgage loan is taxable and affects your social security and Medicare, don’t believe them. The proceeds that you get from this program is not considered as an income but as a loan. Having said that, you do not have to worry about the loan being reduced due to the tax. It’s highly recommended to talk to a social security representative or Medicare to make sure that you know if these will be affected or not.
Another common misconception is that if you have a reverse mortgage loan then you owe a total of more than your home’s appraised value. As a matter of fact, this would never happen thanks to the protections and safeguards added on this financial program by the feds so that your home or estate won’t end up getting a much higher debt compared to its total appraised value.
If you reverse mortgage is already due, then the bank will owe your home. That’s not true. As long as you are still living in your home, you will keep its title and then control it on your own. However, if you are out of that property, then you need to pay the loan. It could be paid through different ways; by selling the property and making use of the money to pay off or by repaying it through other sources of money.
Some say that family members will not likely agree to get a reverse mortgage because of its bad effects. That is not true. There are several things that you can use to make sure that your family members live comfortably. For instance, with the monthly loan income that you get, aside from the monthly retirement pension you receive, you seniors could use the cash to pay for the education of their grandchildren, home remodeling, or for substantial emergency expenses, to name a few.
Call Reverse Mortgage Specialist if you need more information about reverse mortgage.
Reverse Mortgage Specialist
1293 Professional Drive, Suite 204
Myrtle Beach, SC 29577