What Are the Pros and Cons to a Reverse Mortgage?
There are many benefits to investing in a reverse mortgage, and there are also some downfalls. Let us explore both sides.
- The loan can be used at the discretion of the borrower, as long as the use is legal
- You do not make payments until the loan is due
- The investment is tax-free
- You can benefit from the value of your home without having to sell
- nterest rates increase the longer you have the loan without repayment
- The loan must be paid as a lump sum, in full, including the interest rates
- Reserve mortgage interest rates tend to be higher than other loans
- The equity of your home will decrease, leaving fewer benefits for dependents in the case of your death
Reverse Mortgage and Other Loans on Your Home
If you wish to invest in a reverse mortgage, you must first pay off any outstanding loans on your property, such as your existing mortgage or home equity line of credit. Many borrowers will use the reverse mortgage loan to pay off their debts, before using the remaining money for separate financial pursuits. Investing in a reverse mortgage will allow you to get your financial responsibilities in check, before selling your home.
Discover the Best Reverse Mortgage Rates
At Mortgage Alliance - Shoreline Mortgages, Inc., we have been helping homeowners organize their financial responsibilities for years. When you get in touch with us, we will discuss your qualifications and help you shop for the best reverse mortgage rates.
If you want to utilize your home equity without giving up your property, set up a consultation at Mortgage Alliance - Shoreline Mortgages, Inc. today. We look forward to helping you get the most out of your investment.