Most homeowners plan on staying in their current homes when they retire. According to a new Bankrate survey, 62 percent of homeowners never plan to move.1 Staying at home allows seniors to remain in a comfortable and familiar place while being close to family and friends. If you are planning to age in place, your home equity may be able to help you find the financial stability you need.
A reverse mortgage allows qualified senior homeowners to borrow against their home equity tax-free2 while continuing to own and live in their house.3 The money can be received as a lump sum,4 monthly payments, or a line of credit to access when needed.
Accessing your home equity can help you:
- Eliminate your monthly mortgage payment5
- Pay for in home medical care
- Make improvements and repairs to your home
- Stretch your retirement savings
If you would like to age in place but need funds to hire caretakers or make modifications to your home, a Reverse Mortgage may be an option for converting your home equity into the funds you need. Try our reverse mortgage calculator above to receive a quick estimate of how much you may be eligible to receive.
1 Bankrate. 6 in 10 homeowners don’t plan on moving out of their house. Ever. https://www.bankrate.com/mortgages/financial-security-0418/
2 Generally, money received is not considered income and should be tax free, though you must continue to pay required property taxes. Consult your financial advisor and appropriate government agencies for any effect on taxes or government benefits.
3 You will retain the title and ownership during the life of the loan, and you can sell your home at any time (at which time the loan becomes due). The loan will not become due and subject to repayment as long as you continue to meet loan obligations such as living in the home as your primary residence, maintaining the home according to the Federal Housing Administration (FHA) requirements, and paying property taxes and homeowners insurance. Failing to meet these requirements can trigger a loan default that may result in foreclosure.
4 The funds available to the borrower may be restricted for the first 12 months after loan closing, due to HECM reverse mortgage requirements. In addition, the borrower may need to set aside additional funds from the loan proceeds to pay for taxes and insurance.
5 You must live in the home as your primary residence, continue to pay required property taxes, homeowners insurance, and maintain the home according to FHA requirements. Failure to meet these requirements can trigger a loan default that may result in foreclosure.