Michigan Reverse Mortgage
Frequently Asked Questions
Reverse mortgages in Michigan are a type of mortgage that senior citizens can use to borrow against the equity in their homes. Here are some frequently asked questions about reverse mortgages and their benefits.
Q. How does a reverse mortgage work?
In a reverse mortgage, the borrower receives a loan up to the amount of equity he has in his home. Instead of requiring monthly payments as in a traditional mortgage, nothing is due until all borrowers move out of the home, sell the home, or die.
Q. What can a reverse mortgage be used for?
Anything you need it for. Certain types of reverse mortgage can only be used for a specified purpose, but there are reverse mortgages available that can be used for any purpose.
Common uses for reverse mortgage proceeds include home repairs, property taxes, a new car, and supplementary income. But there is no limit to what you can get a reverse mortgage for.
Q. Who is eligible for a reverse mortgage?
Senior citizens who are 62 or older and own their homes qualify for a reverse mortgage.
Q. What are the income requirements for a reverse mortgage?
There are none. Because you do not have to make monthly payments, there is no minimum income requirement for a reverse mortgage. You could have $0 per month in income and still qualify for a reverse mortgage, as long as you meet the age and ownership requirements.
Q. What if I haven’t yet paid off my first mortgage?
If you have not paid off your traditional mortgage, you must pay it off before you can get a reverse mortgage. The reverse mortgage proceeds can be used to do so if there is sufficient equity, and if you have more equity than is needed to pay it off you can receive the difference.
Q. How is a reverse mortgage paid out?
You can receive your funds in a lump sum, as monthly payments for a specified time or the rest of your life, or as a line of credit. Some programs offer the option to combine two of these options. This flexibility is one of the greatest benefits of the reverse mortgage.
Q. Does the bank own my home when I get a reverse mortgage?
No, you retain title to your property. The reverse mortgage is just like any other mortgage in that when you sell your home, you pay off the mortgage and keep the extra money.
Q. Does my home have to meet any special requirements to qualify for a reverse mortgage?
Most owner-occupied dwellings qualify. Houses, condominiums, one to four unit dwellings, and some manufactured housing qualify. Most mobile homes and cooperative housing, however, do not qualify.
Most lenders require a home to be inspected before lending through a reverse mortgage. If any structural problems are found, they must be repaired. In most cases, the proceeds from the reverse mortgage can be used to accomplish this.
These are the answers to some of the most basic and commonly asked questions about reverse mortgages.
If you would like more information about the reverse mortgage process and how it can help you live out your retirement without the stress of financial burdens please call us at 734.238.3MTG (684) or send an email here: firstname.lastname@example.org
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