What determines how much money you can get from a reverse mortgage?
The amount of money you can get from a reverse mortgage depends on your age, the appraised value of your home, the current interest rate and the Upfront Costs of the loan. You can choose to be paid in a lump sum, receive monthly payments, establish an Equity Line of Credit that will can be accessed as needed and the amount available will grow with time. Generally, the older you are, the more you will qualify to receive.
A monthly payment will supplement your income each month, can be set up to receive for the rest of your life or for a fixed period of time. You are not locked into the amount or term. If your needs change, you can make adjustments throughout the life of the loan.
A lump sum will provide you available funds at close of escrow, subject to initial disbursement limits. In some cases there will be a limit to how much a borrower is eligible to receive at the close of escrow. That excess will be placed on a Equity Line of Credit and become available one year later.
Any Combination of the above is possible and will provide you the flexibility to meet your personal financial requirements. This flexibility continues throughout the term of your loan as you can make adjustments as needed.
Becky Smith, has been assisting homeowners realize their dreams with service and experience you can trust since 1980.